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7 Apr 2023

Thai Economy

Thailand’s looming super-aged society presents a formidable challenge for business sector and new government (Current Issue No.3398 Full Ed.)

คะแนนเฉลี่ย

        KResearch expects that Thailand will become a super-aged society by 2029, which is faster than previously estimated. The country’s population began to decline in 2020 through to 2022 for three consecutive years as the birth and fertility rates trended lower, including the fact that about one million baby boomers, who were born between 1963 and 1983, are turning 60 in 2023. At the same time, a restructuring drive to bolster the population is not easy as most millennials are choosing to be child-free amid the highly uncertain socioeconomic situation, which is caused by income insecurity and lingering concern towards new outbreaks, natural disasters, global geopolitical conflicts.
        Aside from certain opportunities, the changing demographic structure presents a number of challenges for the business sector, as well: 1) business income will likely be affected if the number of customers continue to decline, and their spending is almost at the same amount as before. To maintain sales, businesses must induce customers to spend more; 2) Product and service formats have to be altered in alignment with the growing number of senior citizens. To maintain sales growth, businesses must focus on product/service differentiation and price discrimination while also expanding their customer base abroad; and 3) rising business costs in line with a shortage of workers may prompt businesses to improve skills of their workers and use more advanced technologies.  
        KResearch is of the view that businesses may have to quickly adjust to changes in Thailand's demographic structure along with the related challenges. These include economic uncertainty and looming sustainability issues, which require actions from the new government given that they may affect the country’s economic outlook, competitiveness and welfare plans in the future.

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