Pita Limjaroenrat, leader of the Move Forward party, attends a press conference of Thailand’s pro-democracy parties in Bangkok.
Peerapon Boonyakiat | SOPA images | Light Rocket | Getty Images
There is much optimism about Thailand as a result of its tourism potential, but political adversity can still change the foundations of the sport, says Kelvin Tay of UBS Global Wealth Management.
While Thailand is a “big beneficiary” of China’s reopening and expected tourism growth, outbound tourism from China has been “pretty modest” to date. Tay told CNBC “Squawk Box Asia” on Thursday.
He added that the variety of jobs in China must first increase.
Thailand also must reinvest in infrastructure and rebuild at a faster pace, Tay said. The country had planned to expand its infrastructure on the east coast through recent ports and airports, but “for the time being that hasn’t really happened,” based on Tay.
This is largely as a result of policies that Thailand must “regulate … well”, he said.
Thai politics can change the foundations of the sport
Preliminary results show that the opposition parties in Thailand, Move Forward and Pheu Thai, together they secured 99% of the votes counted in the May 14 general election, Reuters reported.
But for the leading Move Forward party to form a recent coalition government, it should have to win the support of junta-appointed members of the Senate who will vote for the following prime minister, Reuters said.
The Election Commission has 60 days to approve election resultsafter which the prime minister can be elected.
Tay said Thailand’s election is a “potential game changer”.
After a vote that showed pro-democracy parties won a transparent majority, the Thai baht hit its highest level since February this 12 months on Monday.
While the SET benchmark index initially rose when the outcomes got here in, but eventually relinquished those early gains.
In actual fact, Thai stocks are the worst performers in Southeast Asia this 12 months, but Tay says Thailand is his “top pick” in the region.
Thailand’s SET index fell 9.22% this 12 months, the most important laggard in the broader Asia-Pacific region. As compared, Malaysia is about 4.5% lower, and the Indonesian Jakarta stock index fell 2.2% over the identical period, based on FactSet.
One other concern is that companies linked to the monarchy could possibly be stifled by a change of presidency, Tay added.
The Move Forward party has called for reforms to the monarchy, including a change to the defamation law.
Work related challenges
Thailand also needs to have a look at its workforce to drive growth, Tay said. He said the country’s fertility rate and aging population were “among the many worst in the world”, but staff could possibly be brought in from neighboring Cambodia and Laos to try to extend the workforce. He added that the cultural and linguistic similarities between the 2 countries make it “easy” for Thailand to accomplish that.
Nevertheless, Thailand may change its immigration policy first. Even after foreign staff have been in Thailand for a few years, “they’re still considered migrants and never … a part of the local population,” he explained.
He added that Thailand should consider providing migrants with a transparent path of whereabouts.