The World Bank and UOB have lowered Thailand’s 2024 GDP growth forecast to 2.4%, with a Thai business group predicting even lower at 2.2%-2.7%. This is due to slow export recovery, political instability, and global economic uncertainties. Despite these challenges, the central bank forecasts a 2.6% and 3% GDP growth for this year and next.
Revised GDP Forecast for Thailand
The World Bank has decreased its GDP growth prediction for Thailand in 2024 to 2.4%, a significant drop from the initial 3.2% estimate. This revision follows a previous adjustment in April to 2.8%. Similarly, United Overseas Bank (UOB) has also reduced its forecast to 2.4%, expressing concerns over export recovery pace.
Factors Influencing the Revision
The sluggish export recovery and global economic uncertainties are the main factors affecting Thailand’s economic outlook. These challenges have led a Thai business group to predict an even lower GDP growth of 2.2% to 2.7% for 2024. Despite these hurdles, the central bank anticipates a GDP growth of 2.6% and 3% for this year and the next, respectively, due to improved global trade boosting industrial activities and exports.
The World Bank has recently revised its GDP growth forecast for Thailand, lowering it to 2.4% for the year 2021. This reduction is attributed to several factors, including the ongoing COVID-19 pandemic, slow vaccine rollout, and reduced tourism revenue.
Thailand’s economy, heavily reliant on tourism, has been severely impacted by the global health crisis. With international travel restrictions in place, the tourism sector, which typically accounts for about 12% of Thailand’s GDP, has been crippled. The slow vaccine rollout has further exacerbated the situation, delaying the reopening of the country’s borders to international tourists.
Moreover, domestic consumption, another key driver of Thailand’s economy, has also been affected. The pandemic-induced job losses and income reductions have led to a decrease in household spending.
The World Bank has also warned that the recovery could be uneven, with the poor and vulnerable populations disproportionately affected. The bank has urged the Thai government to accelerate vaccine distribution, provide additional fiscal support to households and businesses, and invest in human capital to foster a more inclusive recovery.
Despite these challenges, the World Bank remains optimistic about Thailand’s long-term economic prospects, emphasizing the country’s strong fundamentals and resilience. However, the immediate focus should be on managing the pandemic and mitigating its economic impacts.
Source : World Bank cuts GDP growth forecast for Thailand to 2.4%
