More stimulus measures

He said many people now expected a further slowdown in the second half of the year.

"Without measures to boost confidence, a weak economy could lead to a further slowdown. We won't wait until that happens. [Several agencies] have been assigned to propose additional stimulus measures, which could come in one or two months," he said yesterday.

He declined to give any details, though. Yesterday, the government transferred Bt907 million to villages, and Surapong plans to set up shopping areas under expressways to place products from small and medium-sized enterprises. The shopping-area plan should be finalised in two months.

Surapong also moved to open bidding on four urban-train projects - the Red, Blue, Dark Green and Light Green lines - by the end of the year. He believes the infrastructure mega-projects can boost the country's economic output over the long term.

Seventy-three manufacturers making 1,400 items have pressured the government for permission to raise prices.

Earlier, there was some discussion on a cut in corporate income tax, but that has not yet been finalised, because it would have an effect on state finances. A Finance Ministry source said a 5-percentage-point cut in the tax rate to 25 per cent would diminish government revenue by at least Bt50 billion.

Despite the murky conditions, 80 per cent of respondents surveyed by the American Chamber of Commerce (AmCham) still plan to expand their business while 65 per cent expect profits to rise. This compares favourably with an average of 61 per cent recorded in all six Asean countries surveyed.

The annual survey by six chambers conducted last month showed US firms in Asean still expected business expansion in the region and overall profit increases this year despite a downturn in global and US markets.

"US firms here continue to be positive about expansion and the profit outlook. Thailand-based companies lead the region in planning on expanding their businesses," said AmCham president Thomas White. "The survey also shows Thailand is the second most popular destination after Vietnam for US investment opportunities in the region."