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Published on February 20, 2008

The CEOs of listed companies want the Samak Sundaravej government to speed up mega-projects, spur consumption and reconcile social divisions, while slightly more than half of them believe the government will last only one year, says a Stock Exchange of Thailand survey.

The survey results, released yesterday, show that although some investors still feel uncertain about the government's stability, they hope the elected administration will be able to implement the much-needed large-scale investment projects quickly, in order to stimulate the economy.

SET Research Institute executive director Kobsak Pootrakool said the quarterly survey had been conducted among 101 listed companies in eight industries, with a combined market capitalisation representing 62 per cent of the SET's total.

About 48 per cent of listed firms' CEOs believe Thai politics will be more stable, while 32 per cent see the situation remaining the same. The remaining 20 per cent think the political situation will be less stable.

Survey results show 51 per cent believe the new government will last only one year, while 45 per cent think it will stay for two years or more.

Most listed firms - 80 per cent of those surveyed - say a stable government is a key factor for the private sector's decision-making on investment, while 53 per cent believe foreign investors will return to the Kingdom.

As to government spending, 46 per cent of the CEOs surveyed said their priority wish was for the government to proceed with mega-projects as soon as possible, followed by the need for domestic economic stimuli and social reconciliation. The CEOs said the private sector was ready to expand again, having slowed down business plans for the past two years.

Sixty-eight per cent of the CEOs believe the price of raw materials and goods will rise over the next six months, while 50 per cent think inflation will remain at about 3-4 per cent over the next 12 months, up from 2-3 per cent in the previous survey.

The CEOs expect gross domestic product to grow about 4-4.4 per cent this year, down from 4-5.4 per cent in the previous survey and an estimate of 4.5-6 per cent by the Bank of Thailand.

Fifty-eight per cent of the CEOs said they would likely increase investment over the next 12 months, while 38 per cent said they would maintain investment at the same level.

For exports over the next six months, 31 per cent of respondents expect these to slow, while 40 per cent believe growth will remain the same. Twenty-nine per cent expect increased export growth.

Meanwhile, JP Morgan will hold a roadshow in Thailand on April 28-29, JP Morgan (Thailand) president Vorapak Tanyawong said yesterday.

About 30 institutional investors will participate, while 30 listed companies will present their information to investors, he said.

"At the moment, 30 fund managers have confirmed they will join the roadshow in Thailand. They come from the United States, Europe, Hong Kong and Singapore," he added.

Siriporn Chanjindamanee

The Nation