Last Friday’s earthquake in Myanmar caused an estimated 20 billion baht in damages in Thailand, potentially lowering GDP forecasts to under 2.4% amid ongoing trade war effects.
Impact of the recent earthquake in Myanmar
The earthquake in Myanmar last Friday resulted in significant tremors across Thailand, leading to an estimated economic loss of approximately 20 billion baht. This devastation is anticipated to reduce Thailand’s GDP forecast for the year to below 2.4%. The Kasikorn Research Centre warns that the economic situation may worsen if the US government enacts a 25% tariff on Thai exports, potentially leading to a further 0.3% drop in GDP.
Shifts in housing preferences and tourism
The earthquake and ongoing trade tensions are expected to influence consumer behavior and the housing market. Households may experience reduced purchasing power, causing a shift towards traditional homes rather than condominiums due to safety concerns. Additionally, the number of foreign tourists projected at 37.5 million is likely to decline as a result of these uncertainties.
Banking sector and economic forecasts
Given these economic pressures, the Kasikorn Research Centre anticipates that the Bank of Thailand may consider slashing the policy interest rate by 25 basis points in April and possibly further later in the year. Moreover, non-performing loans (NPLs) in the real estate and construction sectors, which had previously dwindled after the COVID pandemic, are projected to rise again by year-end amid the ongoing challenges.
Source : Earthquake could cut Thailand’s GDP growth to below 2.4%
