Thailand’s economic prospects for 2024 have been revised downward, with the latest forecast standing at 2.6%, a dip from the previously anticipated 3.2%. This adjustment comes amidst a delicate economic recovery marked by sluggish private investment, weakened consumer purchasing power, and delays in the disbursement of the 2024 budget, as reported by the Centre of Economic and Business Forecasting at the University of the Thai Chamber of Commerce (UTTC).
Thanavath Phonvichai, UTTC rector and head of the center, highlighted today that the first quarter is expected to witness a modest 2% expansion, with growth primarily driven by two sectors: tourism and exports.
However, the economic landscape remains fragile, with growth anticipated to pick up marginally in the second quarter, reaching 2.5%, buoyed by budget disbursements, tourism, and export activities. Notably, this recovery appears concentrated in specific export segments, such as rice, rubber, and fruits.
Despite some signs of returning consumer confidence, overall sentiment remains subdued, with many individuals still grappling with the lingering effects of the COVID-19 pandemic and higher interest rates, noted Thanavath.
Looking ahead, Vichien Kaewsombat, assistant director of the center, expressed optimism regarding a more palpable economic rebound in the third quarter, projecting a growth rate of 3.1%. This optimism is underpinned by expectations of declining lending rates, in line with potential policy adjustments by the Monetary Policy Committee.
However, growth in the fourth quarter is forecasted at 2.8%, primarily due to concerns surrounding elevated household debt levels, which could lead to an uptick in non-performing loans, prompting financial institutions to adopt a more cautious approach towards lending.
Kaewsombat also hinted at a potential upward revision to the annual growth forecast, suggesting that achieving a 3% growth rate for the entire year might be feasible if there’s accelerated disbursement of the 2024 national budget and swift approval of initiatives like the “digital wallet” scheme.
