Bangkok Q2 2020
Optimism for Bangkok property market to progressively turn positive
• According to the data by the National Economic and
Social Development Council (NESDC), Thailand’s GDP
contracted by 1.8 per cent in Q1 2020, compared with
an expansion of 1.5 per cent in Q4 2019. This was
attributed to the decrease in total exports of goods
and services, private and public investments and
government final consumption expenditure.
• Private consumption expenditure grew by 3.0 per cent.
Durable goods declined by 8.8 per cent as a result of
the decrease in passenger cars at 24.8 per cent. Nondurable
goods expanded by 2.8 per cent, stemming
from the expansion in food and beverage, such as
canned tuna, instant noodles and pure water due
to rising household needs for essential items during
lockdown period caused by COVID-19 outbreak.
• Government final consumption expenditure decreased
by 2.7 per cent, compared to a decrease of 0.9 per cent
in Q4 2019. The contraction was mainly due to a 10.4
per cent decrease in purchases of goods and services,
while compensation of employees increased by 1.1
per cent, slowing down from 1.4 per cent in Q4 2019.
• The industrial sector declined by 1.9 per cent,
corresponding to the decrease in the production in
manufacturing, as production was not at full capacity
during the lockdown period. The service sector shrank
by 1.1 per cent in contrast to a 4.1 per cent increase
in Q4 2019 due to the global coronavirus outbreak,
which resulted in a decrease in international tourist
arrivals to Thailand.
• The construction sector dropped more steeply by 9.9
per cent this quarter when compared to a decrease of
2.1 per cent in Q4 2019. Private construction slowed
down in almost all sectors, including residential,
commercial and industrial plants. The soft residential
market caused some developers to delay new launches
and focused on selling their existing stock, hence
leading to fewer construction activities.
• Public construction was affected by the decrease
in government construction activities, arising from
a delay in the passage of a budget bill for the 2020
fiscal year which caused budget disbursement of
construction to be diminished.