* July production index up 5.12% y / y, down 7% m / m
* Strict virus restrictions imposed in July-August
* Production improves in September – ministry official (adds details)
BANGKOK, Aug.30 (Reuters) – Annual growth in Thailand’s industrial production slowed in July, when COVID-19 containment measures were imposed and extended through August in high-risk areas, as the country Southeast Asia is facing its largest epidemic to date.
Measures in Bangkok and 28 other provinces, however, will be relaxed here from September 1, allowing more domestic travel, as well as the reopening of malls and restaurants, to help its struggling economy here.
The Manufacturing Production Index (MPI) rose 5.12% in July from a year earlier, missing an expected 11% increase in a Reuters poll and down from an 18.27% increase in June, the Ministry of Industry announced on Monday.
While year-over-year growth was helped by a weak base, the production index fell 7% in July from the previous month, with capacity utilization falling to 58.12% from 62.50% in June.
August production will still be affected by the restrictions, but there is expected to be a resumption next month, ministry official Thongchai Chawalitpichaet said in a briefing.
“In September there is an easing of the lockdown and more vaccines, the situation should improve and the MPI should be better,” he said.
The vaccine’s rollout in Thailand is slow, with just 11% of its more than 66 million people fully vaccinated.
The manufacturing sector has also seen a shortage of migrant labor here, with outbreaks in factories adding to the pressure and threatening exports here s-beat-forecast-virus-looms-2021-08-23, a point luminous rare in an economy hard hit by a collapse in tourism.
Industrial goods represent 80% of total exports.
In July, production of automobiles, electronics and rubber products increased, but that of petroleum, hard drives and beer declined.
However, the ministry still expects the MPI to rise 4-5% this year, Thongchai said. (Reporting by Orathai Sriring, Kitiphong Thaichareon and Satawasin Staporncharnchai; editing by Martin Petty)