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17 Jun 2009

Thai Economy

Thai Workers Overseas: Income Repatriations Still Showing Sharp Plunge (Business Brief No.2533)

Thai workers employed internationally in April 2009 fell 13.2 percent in number. Though the data improved over the 24.3-percent shrinkage in March, their income repatriations still recorded a sharp contraction of 13.4 percent YoY, worse than the 4.4-percent decline in March. During 4M09, income repatriations made by Thai workers abroad plunged 11.7 percent YoY – around THB2.4 billion.
Over the remainder of 2009, KASIKORN RESEARCH CENTER (KResearch) believes that the situation for Thai workers overseas may remain vulnerable to numerous risks, particularly, the economic hard times faced by destination countries. Despite some positive signs emerging from such destinations as Taiwan, South Korea and Singapore, their unemployment rates are still rather high. It may take some time to adjust excess production capacity and absorb unemployed workers. In the meantime, demand for foreign workers, including Thais, may be on a decline.
Thai workers employed overseas will also have to compete with other foreign workers, e.g., Vietnamese who are paid comparatively less. Additionally, the rapidly spreading outbreak of Influenza A (H1N1) may hamper the travel and other movements of workers going abroad. Other downsides will also involve unresolved structural problems such as poorly-educated workers, lack of language proficiency, etc.

Amid these risks and restrictions, KResearch therefore maintains our 2009 projection for the number of Thai workers employed internationally at 152,303–159,748, a decrease of 1.3-5.9 percent YoY – a continued contraction from the 0.1-percent shrinkage in 2008. With the ebbing demand for foreign workers, income repatriations by Thai workers abroad in 2009 are expected to decrease 8.3-15.8 percent YoY to around THB5-10 billion, compared to the 11.9-percent growth seen in 2008. Nonetheless, if there is some improvement in the global economy, the situation for Thai workers abroad may gradually improve over the remainder of 2009, which would in turn be positive to their income repatriations.

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