The Ministry of Industry reported that overall industrial production contracted considerably in March 2022 as a result of Russia’s invasion of Ukraine, which resulted in severe global increases in gas prices, oil prices, and inflation.
The Manufacturing Production Index (MPI) was 109.32 in March 2022, down 0.12 percent from the same period last year. The index, however, grew 1.41 percent in the first quarter of this year compared to the first quarter of 2021.
Supporting factors were the reopening of the country and the easing of entry restrictions, which resulted in a steady recovery of domestic demand. This can be seen in the petroleum industry’s constant expansion. Furthermore, the baht’s depreciation benefited the export sector, making Thai products more competitive on the global market.
Meanwhile, geopolitical tensions between Russia and Ukraine have pushed up living costs, particularly in the energy and transportation sectors. As evidenced by the monthly Producer Price Index (PPI) published by the Office of Trade Policy and Strategy, the inflation began to affect industrial operators. The PPI was at 10.4 percent in March, up from 8.0 percent in February.