Industry Horizon (April 2021)

Industry Horizon (April 2021)

09 April 2021

Taking steps towards new investment cycle

 
  • Bright outlook for new investment cycle is driven by three visible trends: (i) the Private Investment Index showed the strongest rise in almost three years; (ii) industrial capacity utilization has finally returned to pre-pandemic levels; and (iii) there are more industries expressing confidence.
  • Information & Communication is operating at slightly above capacity, while Manufacturing and Agriculture are running at nearly full capacity. Accommodation & Food services and Transport & Storage have recovered by 50% from their steepest slack. Within the manufacturing sector, 29.1% of Thai industries are operating at or above-average production rates. They include Chemicals & Chemical products, Commercial Vehicles, IC & Semiconductors, Electrical Appliances, HDD, and Automotive Engine.
  • A K-shaped recovery is a post-recession scenario in which one segment of the economy or industry begins to climb back up while another segment continues to suffer. To survive the post-pandemic world, a country or business needs to transform into one that is based on the provision of modern technology and/or services bound to global megatrends. Thai businesses are also pursuing this trend and preparing to invest substantially in new S-Curve industries.
 

 

World trade and output at record levels, resilient to resurgence of COVID-19 cases worldwide


 

Thailand: New investment cycle in sight


 

ICT is operating above-capacity, while Manufacturing and Agriculture are close to full capacity


 

Within Manufacturing, spare capacity varies across the industry; one-third is operating above-trend


 

New investment cycle for S-Curve industries will help Thailand navigate through the post-pandemic world


 

M&A activity slow down in Thailand, but is booming in real estate, construction, energy, healthcare sectors


 

 

EEC: Current state of play


 

2021 development strategy for EEC will be multi-pronged


 

EEC Policy Committee has identified three central high-potential industries


 

EEC is developing five promoted zones with large investments in the EECd and EECi


 

Logistics centers will benefit from greater economic activity in special economic zones and border regions


 

Government is moving forward with the creation of a logistics network linking southern Thailand to the EEC


 

Connecting markets and distribution networks within EEC


 

Warehousing is benefiting from growth in e-commerce and rising demand for storage of goods/stock

 

Industrial Estate: The EEC remains an attractive investment target for industrial estate developers


 

Oil & Gas: Both tight supply and recovering demand are pushing crude oil prices to pre-pandemic levels


 

Rising investment in non-oil businesses, especially in EVs, F&B, and alternative energy


 

Petrochemicals: Phase IV plan aims to boost investment in special economic zones


 

Power generation: Investment is rising in the EEC in both core and new businesses


 

Digital industries: Investment slowed in 2020, with money tending to go into enterprise software and digital services


 

In 2021-2023, investment in digital industries will rise with greater opportunities and support from the government


 

HDD: Outlook should improve along with the recovering world economy


 

Still, there are several headwinds ahead


 

IC: Sunny outlook as supply shortage will ease soon given stronger investment in major countries


 

Automobile: Clear signs of recovery, so we raised forecasts for output, domestic sales and exports


 

Manufacturers are submitting applications for BOI support for investment in EV production


 

Real estate for sale: Operators are slowly releasing new projects in 1H21 to support ‘real’ demand


 

Joint ventures with foreign investors will tend to switch from condominium to low-rise developments


 

Real estate for rent: In 1H21, recovery in demand will be restricted to the domestic market


 

Retail space operators will continue to develop new projects, especially in the suburbs and upcountry


 

Construction Materials: Production and sales will rise in line with anticipated growth in public-sector investment


 

Private hospitals are investing in the eastern region to capture the 10-million resident market


 

Hotels: Vaccination and easing quarantine measures


 

Restaurants: Businesses increasingly dependent on delivery services


 

Hemp industry offers new investment opportunities


 
 
 
ประกาศวันที่ :09 April 2021
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