Today’s Cabinet meeting agrees to introduce a relief package, including tax incentives and soft loans, for tourism businesses and others hit hard by the recent political unrest. Deputy Finance Minister Pradit Patharaprasit revealed the Cabinet’s resolution allows individuals to seek tax deduction of up to 15,000 baht with spending via tour companies. The incentive will take effect tomorrow.

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Cabinet Approves Toursim Stimulus Package

For 2009 as a whole, nonetheless, real GDP fell 2.3 percent despite a pick-up in consumption in the fourth quarter, external demand will be the main contributor to growth in the near term.
Overall, domestic demand should provide a positive but limited contribution to growth: vulnerable households lost ground in 2009 and risks are substantial in 2010, as falling agricultural output due to the current drought may offset opportunities from the improved overall economic environment. Household consumption levels, which are highly correlated with the poverty rate, contracted in 2009 despite the rebound in the last quarter of the year, suggesting a likely increase in the poverty rate compared to 2008, especially when compounded by the loss in purchasing power from the food and fuel crisis of 2008. The outlook for 2010 is uncertain : average wages are likely to increase, thanks to the reallocation of labor from agriculture to manufacturing. Although labor markets appear very tight, with unemployment below 1 %, the data do not account for the large number of workers who moved to lower-productivity jobs in agriculture and informal services due to the crisis. Many of these workers are now returning to manufacturing, which offers higher wages than agriculture.

In any case, Thailand’s strong rally in 2009 should still be considered in context.
Mr Pathom noted that past a certain level of market capitalization, investors appear to take a different view on valuations.
Introduction The modern Thai Capital Market traces its origins back to the early 1960s. In 1961 Thailand implemented its first five-year National Economic and Social Development Plan to support the promotion of economic growth and stability as well as to develop the Kingdom’s standard of living. Following upon this, the Second National Economic and Social Development Plan (1967-1971) then proposed for the first time that an orderly securities market be established in order to mobilize additional capital for national economic development.

The creation of Thailand’s first officially sanctioned and regulated securities market was initially proposed as part of the Second National Economic and Social Development Plan (1967-1971). In outlining its proposal for the creation of a supervised securities market, the Second National Development Plan stressed that the market’s most important role would be to mobilize funds to support Thailand’s industrialization and economic development.