While some aspects can be compared to the Tom Yum Kung crisis, high national household debt will make the problems harder to solve.

The Thai property sector will face challenges in meeting sales targets this year due to a decline in demand and purchasing power, Thai Condominium Association president Prasert Taedullayasatit said on Tuesday.

He referred to the Asian financial crisis in 1997 and its impact on property prices as financial institutions and asset management companies turned to offering non-performing assets at cheaper rates than the original sale prices.

“The reason behind the decline in property prices during the Tom Yum Kung crisis was a weakening baht that triggered an increase in the debt burden among business entrepreneurs and banks,” he said.

“As many as 56 financial institutions closed, which had a massive impact on investment in various projects and sent entrepreneurs into a downward spiral,” he added, noting that entrepreneurs who took out loans in foreign currencies were affected the most.

However, Prasert said he considered this year’s economic crisis to be different as people suffered from informal debt and rising cost of living, resulting in a decline

in property demand.

“Thai people in the lower to middle market have informal debt and are unable to purchase new homes,” he said, adding that some people have either not found employment or their salaries have not increased.

He noted higher interest rates also meant that home instalments were higher than before and the rejection rate for housing loans was currently standing at 70 per cent due to an increase in construction costs, including land, materials and wages.

“This crisis is harder to tackle compared to the Tom Yum Kung crisis as it is affecting economies worldwide, not just Thailand,” he said.

Source: The nation

The European Union (EU) is drawing up plans to impose customs duties on cheap goods bought from Chinese online retailers including Temu, Shein, and AliExpress, the Financial Times (FT) reported on Wednesday, citing three people briefed on the matter.

The European Commission later this month will suggest scrapping a current €150 (US$161 or RM761) threshold under which items can be bought duty free, the report said.

Under current EU regulations, packages purchased online from a non-EU country are not subject to customs duties if their value is under €150.

Two billion parcels with a declared value of less than €150 arrived in the EU from outside countries in 2023, according to the commission, which says “the sheer volumes of e-commerce are testing customs’ limits”.

Critics of Shein and Temu in the US have already complained that they use import tax exemption there to undercut rivals and avoid customs inspections of their products.

The practice helps the two

companies offer dresses for as little as US$8 and smart watches for US$25 to shoppers around the world.

Source: The edge malaysia

A 2.8 km bridge with six lanes will cross Rach Gia Bay as part of a connection route between Vietnam’s two southernmost provinces of Kien Giang and Ca Mau.

At a total cost of approximately VND3.9 trillion (US$154.5 million), the bridge will link Tay Yen Commune in Kien Giang’s An Bien District with the provincial capital city of Rach Gia.

It will run 3.7 km in total, including leading roads from both sides.

Kien Giang’s Department of Transport, which is in charge of building the bridge using the state budget, has announced that it is holding an architectural design competition for the bridge as the next step in the project.

Construction is expected to be carried out from this year until 2029.

Once completed, it will reduce the load on the existing National Highway 63, while expanding urban space and boosting the economy of the area surrounding Rach Gia Bay.

The bay, part of the West Sea, which opens onto the Gulf of Thailand, is part of the Kien Giang World Biosphere Reserve, recognized by UNESCO in 2006.

In addition, Kien Giang is planning to apply for investment in a 60-km long coastal road project connecting it to Ca Mau using official development assistance loans borrowed by the government.

This route, along with the sea bridge, will close an inter-regional coastal route in the Mekong Delta.

Source: Vnexpress

China said it is helping neighbouring Laos to ease its massive debt burden after the Southeast Asian nation revealed that external repayments have nearly doubled and it wants further deferrals to prevent a default.

Beijing has carried out “mutually beneficial cooperation” with developing countries, including Laos, that involves strong support for economic and social development, a spokesman at China’s Ministry of Foreign Affairs said on Tuesday (July 2) in a written reply to Bloomberg’s questions.

“At the same time, it has been doing its best to help relevant countries alleviate their debt burden,” he added.

China is by far Laos’ biggest creditor, accounting for about half of the US$10.5 billion in external government debt. The tiny nation had US$13.8 billion in total public and publicly-guaranteed debt at the end of last year, amounting to 108% of its gross domestic product.

Communist-run Laos has come to the fore after it opened a high-speed rail line with China in 2021, that cost the landlocked country about US$6 billion. While the development is seen by many as the start of a ramp up in infrastructure that directly connects the world’s second largest economy with Southeast Asia, it has raised concerns of a build-up in debt for smaller nations.

Laos’ external debt payments last year reached US$950 million, making the country defer US$670 million in principal and interest payments. The World Bank has said in the past that such moves have provided temporary relief in recent years.

The country’s debt issues have emerged as the Biden administration seeks to offer developing nations an alternative to China’s efforts to expand its economic influence. Washington has often cast Beijing’s efforts as “debt-trap diplomacy”, as countries like Sri Lanka and Pakistan grapple with repayments.

Sri Lanka fell into default for the first time in its history back in 2022, after its foreign reserves dwindled. Last month, the South Asian nation said it reached final restructuring agreements worth US$10 billion, including with an Official Creditor Committee of bilateral lenders and China’s Exim Bank.

China’s Foreign Ministry spokesman dismissed the “debt-trap diplomacy” allegation, describing it as rhetoric from the US that aims to disrupt Beijing’s cooperation with developing countries.

“It cannot deceive the majority of developing countries,” he said in the written reply.

Source: Bloomberg