Thailand’s Economy Faces Challenges Despite Strong Tourist Arrivals
Despite welcoming around 12 million tourists in the first quarter of the year, Thailand’s economy is facing challenges due to weak exports and domestic demand. According to a Reuters poll of economists, growth in the country’s economy is likely to have been subdued in the quarter through March.
Factors such as high household debt, borrowing costs, and a decline in customs-based exports have contributed to the slowdown in growth. The manufacturing sector has also been affected, dragging down overall economic performance.
To counter these challenges, the government is planning to implement a “digital wallet” stimulus policy, which involves providing cash handouts to eligible adults. This measure is expected to boost the economy and help stimulate growth.
Economists predict that Thailand’s economy likely grew by 0.8% in the January-March quarter compared to the same period last year. While the country is expected to avoid a technical recession, quarter-on-quarter GDP growth is still projected to be soft.
Experts emphasize the need for Thailand to address structural issues and enhance its competitiveness in the global market. They suggest that the country should focus on securing free trade agreements and implementing targeted measures to support those in need.
Despite the challenges, the government remains optimistic about economic growth, with a target of 2.4% for the year. However, the success of a stimulus plan in the fourth quarter could potentially push growth to 3.3%. External factors such as a global economic slowdown or a slower-than-expected Chinese recovery could pose risks to Thailand’s economic outlook.