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Border standoff hits shares

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Cambodian dispute drags down shares

Investor appears at a inventory show board in a buying and selling room. (Picture: Pornprom Sarttarpai)

The border confrontation between Thailand and Cambodia has prompted investor jitters throughout regional bourses, with the Inventory Change of Thailand (SET) index dropping by 4.8% since Could 15.

Border points affected cross-border commerce between the 2 international locations and dented confidence in sectors uncovered to Cambodia, together with drinks, meals, cinemas and hospitality, mentioned Krungsri Capital Securities (KCS).

Corporations akin to Carabao Group (CBG), which derives 10% of gross sales from Cambodia, and Osotspa (OSP), with 7% of gross sales from Cambodia, noticed sentiment dip.

Whereas CBG has contingency plans to ship merchandise through sea routes if border closures persist, analysts warn that additional escalation might result in extra pronounced impacts.

Hospitals had been much less affected as Cambodian sufferers contribute lower than 5% of income for many Thai hospitals.

Medical tourism from Cambodia is essentially performed by air, and exemptions for cross-border sufferers stay in place, mitigating the chance of extreme disruption.

Cinemas and meals exports additionally recorded minimal impacts. Main Cineplex Group (MAJOR), which operates six cinemas in Cambodia, earns 3.8% of its income from the nation.

Meat exporters working in Cambodia embody Charoen Pokphand Meals (CPF), Thaifoods Group (TFG) and GFPT.

Evaluation of information from 5 earlier Thai-Cambodian navy clashes confirmed the SET index dropped by a mean of two.8% one month after every incident, however rebounded by 6.3% over three months and 11.3% over six months, exhibiting the impression is short-lived, famous KCS.

With tensions easing following Cambodia’s troop withdrawal, markets might regain their footing. Nonetheless, analysts warning the scenario stays delicate and renewed clashes might reignite investor considerations, mentioned the brokerage.

Most Thai-listed corporations have minor publicity to Cambodia and the historic resilience of markets to geopolitical shocks counsel the impression might stay contained except the scenario deteriorates considerably, famous KCS.

Cambodia’s funding sentiment was additionally rattled by the border tensions, which emerged late final month.

Tris Ranking expects Cambodian GDP to develop by 5.8% this 12 months and 5.9% in 2026, considerably under the pre-Covid common of 8% throughout 2015-2019.

Cambodia’s financial progress faces rising headwinds as sluggish home consumption, an actual property provide glut, and pressures from US tariffs weigh on the nation’s restoration, famous Tris.

Regardless of an uptick in companies exports, home consumption has weakened, indicated by a slowdown in credit score progress, whereas authorities spending stays constrained by restricted fiscal area, mentioned the scores agency.

Including to those financial challenges are rising commerce considerations, as proposed US tariffs might hit Cambodia’s export sector arduous, on condition that the US accounted for 37% of the nation’s complete exports in 2024, warned Tris.

In the meantime, low-cost exports from China, diverted from the US market as a consequence of excessive tariffs, might flood Southeast Asian markets, additional threatening Cambodia’s commerce place.

The present account steadiness is projected to slender from 0.8% of GDP in 2025 to a deficit of 0.8% in 2026, mentioned the scores agency.

Nevertheless, sturdy overseas direct funding and improved monetary account efficiency are anticipated to assist overseas change reserves, retaining public debt at a manageable stage of round 26% of GDP, famous Tris.



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