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Covid-19 again lowers Thai economic growth forecast to 2.3%



FILE PHOTO: Exports are up, but not enough to cover losses from tourism.

Thailand’s economic growth forecast was lowered to 2.3% as the tourism outlook remains bleak as Covid-19’s third wave pummels the country. Back in October 2020, the Finance Ministry’s Fiscal Policy Office had originally predicted a 4.5% growth for Thailand’s GDP, when Covid-19 seemed to be waning in the country. By January, as the second wave hit, projections were reeled in to 2.8%, and this month it was dropped again another half per cent.

The forecast assumes the government will enact economic stimulus packages worth at least 100 billion baht between now and the fiscal year close on September 30. The FPO expects a fourth-quarter economic recovery to boost the year’s average growth with yearly figures ranging from 1.8% to 2.8%.

Thailand had done relatively well during the pandemic, but the third wave is infecting much higher numbers and, with the vaccine rollout crawling, Covid-19 domestically is negating the positive effects of the world’s economic recovery. A recent evaluation estimated the Thai economy could lose up to 100 million baht per month. Last year Thai exports fell 6.6% but this year the thriving export sector is projected to grow 11%.

But tourism makes up at least 12% of Thailand’s gross domestic product, reportedly 2 trillion baht brought in during 2019, and the Covid-19 outbreak and slow vaccinations mean more delays in reopening to travellers on a large scale. Last year was buoyed as China is Thailand’s top tourism market and the first place to lockdown in the early stages of Covid-19. Last year saw only 6.7 million travellers arriving, which brought an 83% drop in tourism revenue for 2020.

After the ambitious plan to reopen Phuket and tourism sandbox locations July 1 and fully reopen Thailand in October, Covid-19 outbreaks are dashing hopes and the 2021 travel projections were lowered to just 2 million travellers, a devastating blow to the economy.

SOURE: ASEAN Economist


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  1. Charlie

    Monday, May 3, 2021 at 5:57 am

    HAHAHAHA, hilarious. 2.3% growth? In 10 years maybe. Thailand is screwed and everyone except the Thai government knows it.

  2. Charlie

    Monday, May 3, 2021 at 5:58 am

    And btw, TRY to be journalists. The Thai tourism industry is at least 20%. You idiots have it down as 12%. Good God, you are fools.

  3. ynwaps

    Monday, May 3, 2021 at 7:57 am

    I’ll enjoy the cheap prices in this great reset. More Chinese tourists will come as they’re the ones making money. Western tourists probably stay the same but going to enjoy a worthless Thai Baht.

  4. Mr cynic

    Monday, May 3, 2021 at 9:16 am

    Would have thought minus 2.3 percent would have been a more reasonable figure to try to get away with.more realistic figure would probably be about minus 30 percent though really.with nearly all travel and tourism essentially zero and the world freight rates for shipping export products up by about 3-400 percent how can it possibly be anything else.

  5. Toby Andrews

    Monday, May 3, 2021 at 11:49 am

    An indication of Thailand wealth and prospects might be that Thailand is selling a bigger percentage of their gold reserves lately than in the last 10 years.
    However gold prices are up.
    Assuming that they sell the gold for USD, they must hope that the USD does not decrease in value.
    The last gold mine in Thailand was closed by government order in 2016. The reason was that it interfered with the environment. The Australian owners said they had done everything required of them.
    The Australian company who ran the mine stated: They are once bitten and twice shy, and they will not return without a cast iron guarantee of tenure.

  6. Nigel

    Monday, May 3, 2021 at 12:53 pm

    I assume the 2.3% growth is based on a fall of 6-7% loss last year. So in real terms that’s an economy that’s around 4% down on pre-pandemic levels. It’s also highly likely that this number will continue to reduce, although exports may increase to offset some of the loss in tourism?

    As @Charlie says, overall tourism is around 20% of GDP (11-12% from foreign tourism). As all tourism has essentially stopped, including local tourism, then the fall must be nearer to -15% loss of GDP. It gets complex however as local tourism expenditure can find its way in to the economy in other ways. However, I think it’s fair to say two things:

  7. Nigel

    Monday, May 3, 2021 at 12:55 pm

    Why does the carriage return key sometime send the comment ? As I was saying. Two things. First, the real economy fell by more that 6-7% last year. Second, it won’t rise by 2.4% this year. Defies any logic, even Thai style logic!

  8. Simon Small

    Monday, May 3, 2021 at 4:21 pm

    “The Australian company who ran the mine stated: They are once bitten and twice shy, and they will not return without a cast iron guarantee of tenure”

    Chatree / Kingsgate?

    Why would they “return” or anyone want them to return?

    All open pit gold mines in Thailand (Kingsgate’s and the mine near me, which was why I took an interest) were closed in 2016 as the independent studies all showed they were damaging local people’s health as well as causing environmental damage.

    Kingsgate got a payout from their insurers as a result, so they’ve got no claim or rights here. Why do you imagine anyone wants them back, @toby andrews?

    It’s like someone who’s been chucked out of the country and isn’t wanted saying they won’t come back unless they’re guaranteed to be allowed to stay.

  9. Simon Small

    Monday, May 3, 2021 at 4:43 pm

    “An indication of Thailand wealth and prospects might be that Thailand is selling a bigger percentage of their gold reserves lately than in the last 10 years.”

    Are you sure of that, @toby andrews?

    A quick check shows that Thailand’s gold reserves are still 153.96 tonnes, which is what they’ve been since a rise in 2012.

    None have been sold in the last ten years at all (the reserves actually went up slightly in 2017), and the only fluctuations in value have been because of changes in the $ exchange rate and gold price, not because any have been sold.

    Oops …

  10. murika

    Monday, May 3, 2021 at 7:39 pm

    everything this government say are lies, you can make number say anything, 2.3% of what ? 2.3% of economic grow means nothing, grow from what ? at least they could use GDP as an indicator, but that number is made up as well, as everything else, 154 tons of gold, is anyone believe this too ? can anyone outside of the government can check it it’s true, think of thailand as a monarchy ruled by 70 years old military and go back on earth as to believe what they say…. and if you disagree with them you go to jail for spreading fake news, what a joke !

  11. Toby Andrews

    Monday, May 3, 2021 at 8:11 pm

    @Simon Small – Yes I am sure of that.
    I am not going to prove it. I can, but you prove it is wrong with sources.
    It is easy to dispute posts, but let us have evidence . . .

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Neill is a journalist from the United States with 10+ years broadcasting experience and national news and magazine publications. He graduated with a degree in journalism and communications from the University of California and has been living in Thailand since 2014.

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