As the world waits for mass vaccination to revive economic activity, general malaise has overtaken the financial services industry (FSI). And things will probably worsen before they get better: US banks are expected to suffer US$318 billion in net loan losses by the end of 2022, according to Deloitte.

But the extraordinary economic impact of the pandemic has only intensified mortal threats to the industry’s business model that have been brewing for years. If the global economy were to recover completely tomorrow, FSI incumbents would still be in a highly precarious position.

In a new whitepaper, we argue that going back to the pre-Covid “normal” is not an option for financial services. Fortunately, the rise of the subscription economy points towards frontiers of untapped growth for the sector.

Shaky ground

Growing regulatory pressures, low interest rates, digital disruptors (both fintech and Big Tech) and savvy customers demanding better experiences at lower costs all have put wide cracks in the FSI’s legacy business model. We’ll confine our argument here to two key revenue streams.

First, the pervasive and persistent low-interest-rate environment has severely impacted profitability since the 2008 global financial crisis. As interest rates are determined by central banks, FSI companies have no control over this destructive and volatile aspect of the business. The Covid-19 fallout has increased downward pressure on interest rates, which have dipped into negative territory in many countries. It is safe to say that there is no short-term end in sight to this trend.

Second, customer fees may no longer be as reliable a…

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BANGKOK (NNT) – Hopes of restarting the tourism sector might need to be pushed back again as new cases of COVID-19 reach a record high. The Deputy Prime Minister and Minister of Energy said today that this new wave might bring Thailand’s 2021 GDP down from its 4% target, while stressing the government will be introducing more economic stimuli.

Deputy Prime Minister and Minister of Energy Supattanapong Punmeechaow said the Thai economy overall can still move forward following a good performance by the export sector, however the new wave of COVID-19 cases might bring down expected GDP growth this year to below the 4% target.

Mr Supattanapong said the government will do all it can to stimulate the economy, by issuing measures to stimulate domestic consumption, as well as proceeding with infrastructure investment to create more jobs and income among younger generations.

Whether or not the new wave will affect the country’s reopening date for foreign visitors of 1st July, the DPM and Energy Minister said the situation will need to be monitored day by day, as the situation is currently developing around the world.

He said the most important thing is to regain confidence among the general public through effective epidemic control action that allows the economy to grow simultaneously.

Mr Supattanapong said he believes the situation will improve, as the people are now more experienced with how to protect themselves, and the government now has experience from the previous outbreak in Samut Sakhon, while stressing the healthcare system is capable of handling the increase in the number of patients.

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BANGKOK (NNT) – Thailand’s fruit exports continue to increase, despite the sluggish global economy caused by the COVID-19 pandemic, with key trade partners being countries that have free trade agreements (FTAs) with the kingdom. Thai durian, mangosteen, longan and mango are popular in China, Hong Kong and ASEAN member states.

Director-General of the Department of Trade Negotiations, Oramon Sapthaweetham, said Thai fruit exports, to 18 countries which have FTAs with Thailand, reported 107 percent growth in the first two months of 2021, compared to the same period of last year. The total trade value was US$461 million, accounting for 94.94 percent of the country’s total fruit exports.

China, Malaysia, Singapore, Indonesia, the Philippines, Hong Kong, Australia and Chile are top importers of Thai fruits, especially fresh durian, mangosteen, longan and mango. Thai exporters are able to benefit from FTA privileges.

Currently, Thailand is the 7th largest fruit exporter, and the country is expected to maintain continuous growth in the long term. This is an opportunity for farmers and traders to expand their export operations, particularly in markets which already have FTAs with the country.

Thai farmers should maintain the standard of their produce, improve the product quality, to meet market demand, and adapt to the new trade environment during the COVID-19 situation, while building the confidence of consumers. They are encouraged to make use of FTA privileges to increase market share and create more value.

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The Thailand Board of Investment (BOI) said today it has recently approved new projects in the field of advanced biotechnology, worth a combined 2.4 billion baht (around USD78 million) in investment, reflecting the increased interest of local and foreign investors in the country’s biotech sector.

“These new and exciting projects reflect investors’ continued interest in Thailand biotech capability,” Ms. Duangjai Asawachintachit, Secretary General of the BOI.

Thai Kyowa Biotechnologies Co., Ltd., a producer of amino acids for pharmaceuticals affiliated to Japan’s Kirin Holdings, received approval for an advanced biotech project to produce Human Milk Oligosaccharide (HMO), a prebiotic and key ingredient in milk powder for infants and adults, helping to build immunity. The fully Japanese-owned company, located in Thailand’s eastern province of Rayong, expects HMO production to start in 2022, mainly for exports.

Genepeutic Bio Co., Ltd., a company established by doctors from the Ramathibodi hospital in Bangkok, and local investors, received approval for a project to develop and produce an innovative treatment for patients with Acute Lymphoblastic Leukemia (ALL). The company, based in the Thailand Science Park, close to the country’s capital, was setup to develop CAR T Cell advanced therapy medicinal products (ATMP).

Fruita Biomed Co., Ltd., a company related to Thailand’s Fruita Natural Co., Ltd., a…

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