General Business Continues to Thrive Despite Protests
Many of our clients are inquiring into the current status of business in Thailand, generally, and in Bangkok, specifically. To the surprise of many, Thais included, the Thai Stock Exchange continues in a general upwards direction as businesses throughout Thailand continue to report growing sales. Experts are predicting GDP growth by year end to surpass 6%. Indeed, the protests that have made international news have had little impact on slowing down Thailand's national economy.
So surprised were the protesters, that in the second week of their protests they marched to the Stock Exchange of Thailand to inquire as to how the SET continues to climb despite their ongoing protests. From a low of 348 in October 2008, the SET Index reached a 52-week high of 812 on April 7, in the midst of the red-shirt protests. Although there was some sell-off since then, the SET index is again on the rise, presently standing at 761--higher than where it stood before the protests in Bangkok began.
As for exports, year-on-year Thailand is seeing a progressive recovery. February 2010 exports (value by US$) equalled $14.4 Billion, as compared to only $11.7 Billion in February 2009, and even exceeding the $13.2 Billion effected in February 2008. Comparing by 12 month periods, the last 12 months (March 2009- February 2010) have seen a total of $158 Billion in exports, as compared to $159 Billion in the year 2007-2008. While still $20 Billion below its peak in 2008-2009, this is well above the $113 Billion and $132 Billion in exports in years 2005-2006, and 2006-2007.
As for the Tourism Industry, at its 2008 peak it generated an overall US $15.23 Billion according to the Tourism Authority of Thailand. This equates to less than 10% of export sales proceeds and less than 6% of Thailand's GDP. While certainly the tourism industry does bring significant income to Thailand, and while this figure has definitely been affected by recent protests, it does not significantly jeopardize Thailand's overall economic recovery which relies for the vast majority on other services and exports.
As for our offices in particular, while the Centralworld shopping center and other malls and hotels in the immediate vicinity remain closed, the Centralworld Office Tower where Atherton is located on the 29th Floor remains open and accessible from the Skytrain (exit at Siam Paragon). Our offices continue to cater to all of our client's needs without any disruption. As a further convenience to our clients, we have also secured meeting space at 1 Silom Road (near Centralworld, but outside of the protestor perimeter).
(By John Fotiadis, Senior Member, Atherton. John Fotiadis specializes in customs and international trade law, including WTO, anti-dumping, and free-trade agreements).