Thailand’s high-stakes effort to rejuvenate its sinking stock market is faltering, weighed down by persistent economic worries. Despite funnelling $4.5 billion into the state-backed Vayupak Fund just seven months ago, the country’s primary SET Index has plunged over 16% this year, ranking as the worst performer among 92 global indices monitored by Bloomberg.
Foreign investors have pulled out a staggering $4.2 billion over the past year—more than any other Southeast Asian market. Analysts say the pessimism stems from deeper concerns, such as stagnant economic growth, soaring household debt, declining manufacturing and consumer demand, political unrest, and ongoing corporate controversies.
Additional external pressures like US trade disputes and a stronger dollar have only fueled the exodus, prompting investors to retreat from riskier emerging markets, including Thailand.
The Vayupak Fund’s goal of stimulating the local market by injecting capital into domestic firms initially stirred optimism. However, the lift proved short-lived. About 50% to 60% of the fund’s capital has been deployed, yet stock valuations continue to decline, with limited signs of recovery.
Recent moves by the government—ranging from a $4.4 billion cash handout package to infrastructure boosts, tax incentives, and proposals to legalize casinos—have so far failed to revive confidence. Experts argue that without more aggressive reforms fostering a business-friendly environment, the malaise will persist.
Investors and analysts alike are looking to Prime Minister Paetongtarn Shinawatra’s administration for decisive action to reverse the tide.