The insightful Rector of the University of the Thai Chamber of Commerce (UTCC), Thanavath Phonvichai, unveiled a piercing revelation at a widely-attended press briefing session. The discussion that took place on Thursday revealed an alarming statistic – a staggering 99.8% of the 1,300 individuals who participated in a nationwide survey carried out between 17th and 21st July, admitted to being saddled with debt.
The study found an intimidating figure of 559,408.7 baht representing the average household debt, an amount which is unprecedented and the highest recorded in the past 15 years, as per Thanavath. He further demonstrated that typically, each household was burdened with the daunting task of shouldering approximately 16,742 baht on ‘debt-service’ each month.
The outcome of the survey shed light on the important fragments of this economic puzzle. It painted a revealing picture wherein it found that a vast majority, precisely 80.2% of the participants, confirmed that they had borrowed money from either banks or financial companies. A significant 19.8% had taken on loans from sources outside the conventional banking system. On a more striking note, a substantial 31.2% were juggling debt from both the banking and non-banking lending institutions, stated Thanavath.
Surprisingly, despite the ongoing economic turmoil, a large section of the Thai population is still grappling with the blowback of the Covid-19 pandemic. This on-going crisis, coupled with the trade turf war between major global powerhouses, China and the United States, continues to constrain Thailand’s economy. The pace and progress of Thailand’s economic recovery are growing at a rate that’s seen as worryingly sluggish, reiterated Thanavath.
The survey uncovered another startling reality – that nearly 65.8% of the respondents were facing an income deficit, meaning they were spending more than they were earning. On the other hand, 32.2% of those surveyed could barely cover their expenses with their earnings, while a meager 2.2% reported earning teetering above their expenses.
Thanavath also referenced that among those facing an income deficit, a significant 41.7% hinted at the possibility of borrowing even more to make both ends meet and maintain economic balance. He further emphasized that household debt is anticipated to continue its upward trajectory until the following year. Nonetheless, he provided a ray of hope as he projected that household debt levels could potentially show a gradual declining trend once the overall economy is fully back on its feet, as per the forecast from the University.
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