The investment atmosphere in Chiang Mai has improved in recent months as local punters gain greater confidence in the country’s political and economic outlook.

Hundreds of people in the northern city attended an investment exhibition hosted by the Stock Exchange of Thailand and the Money Channel on Saturday to discuss market trends and financial innovations.

Vithaya Thuvathananurak, the president of the Securities Companies Club, said investment interest in Chiang Mai had improved over the past two months as political uncertainties had eased.

“Local people are more confident about the political situation, so I think they are ready to spend more and resume investing,” he said.

The government has already announced that general elections would be held on Nov 25, following a referendum on the new constitution on Aug 19.

Analysts say an election would help clear the uncertainties that have held back investment activity and economic growth since last year.

Indeed, the Stock Exchange of Thailand index, the worst performer in Asia last year, gained 15.3% in the second quarter and 14.3% in the first half, beating out markets in Taiwan, India, Hong Kong and Japan.

Mr Vithaya said daily trading volumes in Chiang Mai had risen significantly over the past two months compared with the first quarter. A number of brokers are now expressing interest in opening new branches in the city, where 16 brokers now have 21 branches.

According to the SET, Chiang Mai ranked first among northern provinces in terms of trading volume, with 20.27 billion baht during the first five months or an average 4.05 billion baht per month. Trading in Chiang Mai represented 49% of the total turnover in the North of 41.56 billion baht.

Rachan Maneekarn, acting president of the Chiang Mai Bankers Club, said local people had high savings but were conservative about investing. It is estimated that total savings in Chiang Mai are around 180 billion baht.

“What we should do is provide more information to local people and encourage them to invest in the stock market,” he said.

Narong Kongprasert, a director of the Chiang Mai Chamber of Commerce, said he wanted to see Chiang Mai-based companies seek listings on the stock market. Currently, only one company, Chiang Mai Frozen Food (CMF), is listed.

“It should be good if Chiang Mai-based firms are listed on the bourse. They will help mobilise funds to expand the manufacturing sector and expand the local economy here,” he said.

Suchada Kirakul, an assistant governor of Bank of Thailand, said second-quarter economic growth for the country should be at least 4% and growth for the entire year should stay between 4% and 4.5%.

“We believe that the economy will eventually pick up the third and fourth quarters, as there is a support factor from the general election. Consumer confidence should improve,” she told investors at an economic seminar.

The central bank suggested that the private sector resume expansion plans and new investment in light of positive growth trends.

Montree Sornpaisarn, the CEO of Kim Eng Securities, said his brokerage would revise up its earnings growth forecast for listed companies to 5% from 3%, following improved indicators.

Source: BangkokPost