Thailand’s economic growth hits a snag but hope remains
Thailand’s financial fortunes took a slight dip as the latest economic figures failed to meet the lofty heights analysts had anticipated. Official data reveals a respectable 3.2% growth in the last quarter of 2024 compared to the previous year, which, while promising, didn’t quite hit the 3.9% growth mark predicted by a Reuters poll of analysts.
The National Economic and Social Development Council (NESDC) detailed the country’s economic performance, with Southeast Asia’s second-largest economy showcasing a seasonally adjusted expansion of 0.4% from October to December. This fell below expectations of a 0.7% rise. In contrast, the previous quarter saw a notable 3.0% year-on-year growth and a 1.2% quarterly increase.
Nevertheless, 2024 brought a glimmer of economic promise, as Thailand’s economy grew by 2.5%, up from a revised 2.0% in 2023.
For 2025, the NESDC has kept its forecast steady, predicting growth between 2.3% and 3.3%, with a midpoint of 2.8%. This forecast banks on bolstered government expenditure, an uptick in private consumption and investment, a resurgence in tourism, and a boost from exports.
Commerce Minister Pichai Naripthaphan remains optimistic, expressing a firm commitment to diplomacy in sidestepping potential US tariffs amidst concerns over the trade surplus affecting export figures.
“We’ll do everything in our power to avoid becoming a target.”
Adding another layer to the economic mosaic, the Bank of Thailand had kept its primary interest rate steady at 2.25% in December, following a surprising 0.25% cut in October.
Governor Sethaput Suthiwartnarueput reiterated to Reuters the rationale, citing elevated household debt levels as a key factor. Despite the cautionary move, there’s still room for growth leeway, even if expectations fall short of 2.9% for 2025.
As eyes turn to the next Bank of Thailand policy review slated for February 26, stakeholders across the nation are keeping a watchful eye on fiscal strategies to ensure Thailand’s economic ship stays steady on potentially choppy waters.
There’s cautious optimism that targeted investments and strategic policy alignments will help Thailand navigate past economic fluctuations and onto a path of sustainable growth.
Latest Thailand News
