Economic growth predicted at 3.6% next year in Thailand

Kasikorn Research Center (KResearch) revealed Thailand‘s economic outlook for 2024, which paints a gloomier picture than anticipated.

Managing Director and Chief Economist Burin Adulwattana reveals that the global economy is slowing down, impacting global trade.

“This is reflected in the deceleration of the manufacturing sector worldwide, especially in China and Germany, which are both heavily reliant on exports.”

The Thai economy is now expected to grow at a sluggish 2.5%, down from the initial forecast of 3.0%, all thanks to the chilling winds of the worldwide economic downturn.

The epicentre of this economic earthquake lies in China, where a faltering economy, particularly in the property sector, is sending shockwaves across the globe, said Burin.

“The Chinese economy remains hindered by its ailing property sector, which has hurt domestic demand.”

The US Federal Reserve (Fed) believes the US economy is a shining star, likely to keep interest rates high next year. However, buckle up, because the financial market is buzzing with rumours that the Fed might start slashing rates in the first half of 2024.

As Thailand weathers this economic storm, KResearch predicts a ripple effect on international tourism, with the number of foreign visitors expected to dwindle to a mere 27.6 million this year. This, coupled with a projected 1.3% contraction in merchandise exports, spells trouble for Thailand, reported The Nation.

The grim outlook continues as domestic demand takes a hit. Thai tourism has struggled to bounce back fully, and the manufacturing sector faces a prolonged slowdown. Throw in hefty household debt, a slump in car sales, and core inflation below the Bank of Thailand’s target, and you’ve got a recipe for economic woes.

KResearch foresees a glimmer of hope in 2024, with a projected 3.1% growth. Public investment and consumption, coupled with a 2% surge in merchandise exports, are expected to breathe life back into the Thai economy. International tourist arrivals might also jump to 30.6 million, provided the Thai government’s digital wallet initiative gains momentum.

If the Thai government rolls out the digital wallet scheme, experts anticipate a whopping 3.6% economic growth.