In August 2016, general economic
activity in the northern region was slightly slower, due mainly to weakness
of consumption on necessitate goods and cross-border exports to Myanmar.
However, government spending and tourism have been a key driver. Meanwhile,
main agricultural productions was higher at the beginning of harvesting
period which helped slightly improve of farm income and production of
processed agricultural products, except for the lower prices. Meanwhile,
underperforming sectors have been on the export of electronic parts and
private investment, particularly on real estate activities. On the economic
stability, key indicators such as unemployment rate and headline inflation
were somewhat benign. At end-July, 2016, commercial bank’s deposits grew at
same pace last month but credits growth eased off.
Government disbursement especially
investment expenditure accelerated by 30.7 percent ahead of fiscal year
ending to support payment schedule on various infrastructure projects such
as road, campus and hospital buildings as well as transfers to those of
Tourism sector continued its momentum
despite of coming the ‘green season’. This was attributed to an impressive
number of domestic tourists attending special events and seminars while the
Chinese tourists slightly eased off. Most key indicators were satisfactory
such as air passengers, hotel occupancy rate and Value Added Tax (VAT)
collected from hotels and restaurants. Direct flights and foreign tourists
passing through Chiang Mai International Airport slightly declined.
Private consumption was up by 1.8
percent reflected mainly by an increase of auto sales as a result of
stimulating sales campaign earlier. Meanwhile, high household debt and tight
credit condition have been deterring consumer sentiment and spending
including lower fuel consumption despite an improving farm income this
Export value dropped by 2.7 percent, as
exports of electronic components to China, Singapore and Philippines as well
as declining exports to the Lao PDR and the southern China. Meanwhile,
cross-border exports growth to Myanmar was lower. Import value, by contrast,
expanded by 14.7 percent, owing to imports of electricity from Lao PDR, and
vegetables and fruit from southern China.
Private investment fell by 2.0 percent
contributing to sluggish construction and real estate activities which
coincided with slower credits to construction and real estate business.
However, marginal investment was only observed in hotel business. Key
private investment indicators have been declining which were the
construction area permitted in municipal zone, sales of construction
materials and import value of machinery and equipment, except for a
temporary increase of registration of commercial vehicles.
Manufacturing production shrank by 11.9
percent, despite of improvement in processed agricultural products including
rice mill, processed production of vegetables and fruit from less drought
impact. However, due to slackening demand from trading partners abroad and
severe competition, key exports on electronic components, optical lenses and
hard disk drives remained underperformed. Productions of beverages also
dropped after acceleration in the earlier period for new bottle and
Agriculture sector declined but showed
an upward direction in terms of output and prices. Major crop production
posted smaller decline to 6.4 percent, with increased production of rice and
livestock, including swine, broilers, chicken eggs and chicken following
higher domestic and external demand. However, output of maize and longan
have fallen. Agricultural price edged up by 2.0 percent, mainly from
increased prices of rice and longan as well as swine and eggs. Farm income,
thus, decreased by 4.5 percent, but improved from previous month.
On the stability front, economic
stability remained sound. Headline inflation rate was up slightly to 0.1
percent, basically from higher prices of eggs, vegetables and fruit, in
contrast, price of gasoline sold locally has dropped. Unemployment rate was
at low level of 1.0 percent, significantly increased in non-agricultural
sector. However, number of unemployed persons who claim for unemployment
benefits tended to increase.
In the banking sector, at the end of
July 2016, the outstanding of commercial banks’ deposit grew by 5.0 percent
to 635,268 million baht, slowing down from the previous month, due to
withdrawal of public entities to state-initiated projects and somewhat seek
for higher yield. Meanwhile, credits eased by 1.7 percent to 578,629 million
baht following low household and manufacturing confidence. None-performing
loans (NPLs) also rose slightly. Loan to deposit ratio was at 90.8 percent,
closed to that of previous month. (BOT)
Wasan Kongjan announces the upcoming seminar for people interested in
investing in small hotels in Chiang Mai, to be held on October 15 at Chiang
Mai Grand View Hotel.
The booming hotel business in Chiang
Mai will be the topic if a seminar to be held on October 15 by Modern
Property Consultant Co. Ltd the Managing Director, Wasan Kongjan, announced
The seminar, which will be held at the
Chiang Mai Grand View Hotel from 8:30 a.m. to 5 p.m. will suit those
interested in investing in, or who already own, small size hotels,
guesthouses, boutique hotels and others in that size range.
The seminar will discuss such issues
image, room rate adjustments, and improving professional management. Also
under discussion will be the appropriate forms of investment, target group
trends, location relating to main targets, and expansion of purchasing
The seminar registration fee is 10,000
baht and will cover two people. The Managing Director said that already have
over 200 applicants. At the event attendees will meet successful owners of
hotels which have full occupancy for the whole year, such as Bed Prasingh,
Bed Nimman, S-Trip Poshtel, and Sleepbox. The owners and managers will
reveal ideas and tips for project operation including location selection,
design, target customers, marketing methods. A marketing team from Agoda
will also be attending the event to offer tips for using Agoda.
Wasan Kongjan noted that Chiang Mai has
a great potential for investing in tourism and as the hub of economic
activity for the North it links Thailand with China and the AEC. The GPP of
Chiang Mai has grown at about 8 percent per year for the past 10 years. GPP
184,132 million baht in 2014 and was the highest in the North.
Tourism in Chiang Mai has grown from 3
million people in 2010 to 7.4 million in 2015, a 146 percent increase in
five years. Chiang Mai International Airport has also seen tremendous
passenger growth during this period and in 2015 reached 8.3 million
passengers with 982 flights per week. The Airports of Thailand predicts
passenger numbers will reach 14.6 million by 2025 and has plans for
expansion to handle 18 million passengers a year.
The government is also putting for the
high speed Bangkok – Chiang Mai train route, an MOU was signed with Japan to
start on that on August 6th and construction is expected to begin
in 2018. Other infrastructure projects include linking Chiang Mai – Chiang
Rai with a better road, outer ring road, and electric train in Chiang Mai.
The government will promote Chiang Mai
to be a center of international tourism and service provider; MICE City and
Wellness City, the center of commerce, investment, and transportation :
Northern Land Port, city of safe agriculture : Northern Food Valley, Center
of international education to universal : Education Hub, and nice place to
live : Eco-Town Eco-Village.
He said that investors should take care
as it requires care and to ensure that one falls within laws such as land
titles, licensing, and building modifications.
Mr. Wasan also noted that new
businesses must have good marketing and an understanding of their target
groups, for example Thai tourists like to visit in the winter. Interested
people can make reservations at
[email protected] , or call
Official Line: @m-property, for additional information at Facebook:
Modern Property Consultants