The Centre for Economic and Business Forecasting (CEBF) at the University of the Chamber of Commerce (UTCC) estimates that up to THB 120 billion will be flown during the two-month election campaign period. The centre is confident that there will be no pause in government spending. Economic growth of 3 to 3.5 percent is expected in the last quarter.
Thanawat Phonvichai, president of the UTCC and advisory chairman of the CBEF, told reporters that after Thailand dissolved its parliament on March 20, 2023, it is expected that there will be elections and the country will have a new government by August.
He said that at least THB 50bn to 60bn (1.46–1.76 billion U.S. dollars) will be spent during the election campaign. This money will then boost the economy to around THB 100bn to 120bn (2.935 to 3.520 billion U.S. dollars) in April and May, resulting in the economic growth of about 0.5 to 0.7 percent.
Thanawat further pointed out that under a caretaker government, it is understandable that the government will not be able to perform to its full capacity. However, he stressed that it is important for the government to continue all current spending to support the private sector.
He is still confident that the caretaker government will be able to do so. Thanawat, however, acknowledged that there might be a pause while the new government is being formed, as several policies are still being dealt with as part of the policy proposal to parliament.
He said that the public must pay close attention to who will be the next prime minister, whether there will be an overwhelming victory for a particular party, and what the joint formation of government from several parties will look like.
Many political parties want to hold a majority election to influence the formation of the government. Thanawat said all these factors could affect the Thai economy. He stressed that the upcoming elections will be very contested.
Wachira Khuntaweetep, president of CEBF, said that according to the survey on the political impact on the economy, if the elections are held in May 2023, about 40.1 percent of businesses will be affected as they will spend more money during the election campaign and sales of goods and services will increase. This will also boost political confidence.
“About 40.3 percent of private businessmen expect the economy to grow between 3.35 percent and 3.82 percent in the last quarter,” he said.
UTCC estimates growth between 3 percent and 3.5 percent, no change from the previous forecast. The centre expects the [GDP] forecast to be adjusted again in July 2023 after the election.”
About 11.5 percent of business people see negative effects of this election, worrying that economic policies will not continue, that politics will be unstable and that many parties campaign on rising wages.
In addition, 47.5 percent of respondents believe that politics will have a strong impact on the Thai economy.
Businessmen also express their concerns following the dissolution of Parliament. Some 79.5 per cent are concerned that the cost of doing business will increase. 78.3 percent are worried about politics going unchecked. 60.3 percent are worried about political differences. 58.9 percent are worried about the stability of the new government. 57.4 percent are worried that there will be no obvious anti-corruption measures.
The private sector needs government support to reduce production costs, especially wages, interest rates and energy. They want government spending to accelerate, especially while the government is in office.
They also want the government to continue to support the tourism industry and to take care of the stability of the baht and household debt, as the Thai economy has not yet fully taken off and the global economy is still subject to risks.