While Pheu Thai Party has faced growing political challenges, the business community is urging Paetongtarn to act swiftly and decisively to regain the trust of both the people and the markets, before the country’s economic situation worsens further.
The survey revealed that 65% of CEOs believe the political situation has caused a severe economic slowdown, with a risk of further economic decline. 32.7% see the slowdown as less severe but still affecting some sectors, while the remainder had a more optimistic view of the economy’s potential.
When asked what action Prime Minister Paetongtarn should take, 42.6% of CEOs said she should resign, 27.7% called for the dissolution of parliament, and 26.7% thought a Cabinet reshuffle would be the most appropriate response. Some CEOs also suggested focusing on national reconciliation and other solutions.
Regarding the stability of the current government, over 70% of CEOs expressed significant concerns, believing the fragile political situation would impede the government’s ability to implement effective economic policies. 22.8% were moderately concerned that this instability could affect the continuity of certain policies, while 4% felt that, despite the challenges, the government could still push forward with its policies.
More than 55% of CEOs believe that current political uncertainty in Thailand is significantly affecting business strategy planning, forcing companies to consider political risks more carefully in their long-term strategic planning. Another 40% of CEOs feel that political uncertainty is making long-term planning extremely difficult, requiring frequent adjustments to business plans.
When asked about how current political issues in Thailand (such as the conflict within the coalition government and the Cabinet reshuffle) are affecting private sector confidence, more than 56.4% of CEOs said they had a strongly negative impact, significantly reducing investor confidence. Nearly 37.6% of CEOs said the impact was moderate, causing hesitation in investment decisions.
Regarding the confidence of foreign investors, more than 50% of CEOs felt that a Cabinet reshuffle would have a moderate negative impact, possibly delaying investment decisions. However, others saw it as a minor issue that investors could understand, as it concerns internal matters. Some CEOs also felt that it could lead to a significant negative impact, causing foreign investors to lose confidence in the Thai market.
However, most CEOs believe that a Cabinet reshuffle may cause delays in policy implementation, but the overall direction should remain largely unchanged. Some also saw potential benefits if the new ministers were more capable and better suited to their roles.
When asked about which government policies were most necessary and should continue to be pushed forward, most CEOs agreed that the government should prioritise household debt relief and improving public welfare. Following that, CEOs suggested pushing for policies to stimulate tourism and services, along with policies to promote new target industries and encourage foreign direct investment (FDI).
As for recommendations to restore confidence in the business sector and the economy amid current political challenges, most CEOs said the government should focus on clarity and continuity in long-term economic policies. Additionally, there is a need to improve the efficiency of bureaucracy and enforce laws more effectively, while also supporting private sector participation in policy formulation. Most importantly, reducing political conflict and fostering political stability were highlighted as essential factors.
However, when asked whether the government has effective plans or strategies to solve the economic problems, more than 57.4% of CEOs said they felt the government lacks a clear or effective plan. The remainder of CEOs noted that they had not seen enough effort to tackle the issues.
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