Editorial by Lorenzo Galanti, Ambassador of Italy to Bangkok
Thailand and most of ASEAN countries are facing an epidemic wave mainly due to the Covid-19 Delta variant with the inevitable measures that limit economic activity and mobility, with a negative impact on growth prospects for 2021. At the same time, the governments are trying to accelerate the vaccine supply. Thailand, which has a very high capacity of inoculation but does not participate in COVAX, is multiplying sources of supply and diversifying vaccines, originally confined to Sinovac and AstraZeneca. It aims to reopen at least partially the Kingdom by October and to vaccinate 70% of the population (about 50 million people) by December.
Meanwhile, the growth estimates of the Thai economy have been revised downwards by the Bank of Thailand which now predicts a modest 0.7% for 2021 and a rebound of 3.7% next year. The recovery of tourism will not be rapid, due to the restrictions on international travel still in force in the main countries of provenance such as China. It is important to increase efforts to attract investments in innovative sectors, thanks to IT infrastructure and 5G. The Bank of Thailand is developing a prototype of digital currency to facilitate transaction and consumption, the Retail Central Bank Digital Currency. On the consumption side, the market has moved a lot online, on digital platforms.
The ICE office Agency in Bangkok, in collaboration with the Italian Embassy, has launched a program with Lazada Thailand, the e-commerce platform controlled by Alibaba, for a virtual pavilion of authentic Italian products. The initiative starts these days on LazMall (the portal of quality brands) and in a first phase is dedicated to food, but it will expand to the non-food sector. At the same time, an offline campaign is being promoted by ICE Agency at the stores of Central Department stores (the main Thai retail group that controls La Rinascente in Italy) to promote Italian products, food and non-food, on the shelves. A first relaxation of the lockdown in Bangkok decided these days will stimulate a recovery in consumption. The first half of the year saw an increase of Thai exports thanks to the traction of the main markets (China and the US) and the weakening of the currency, Thai Baht, but also an increase in imports, which benefited the Italian export that has returned to the levels of 2018.