BANGKOK: Thailand’s economy expanded less than expected in the last quarter of 2016 and the government left its forecast for growth this year unchanged, indicating recovery will remain a slow process.
Growth in October-December was 0.4% from the previous quarter, on a seasonally-adjusted basis, below the 0.6% seen in an online poll. The government revised July-September growth to 0.4%, from 0.6%. On an annual basis, the economy expanded 3.0% in the final quarter, matching the poll forecast.
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The national planning agency, leaving its 2017 forecast at 3.0%-4.0%, said expanding exports plus higher crop production and state spending will aid growth this year. But analysts are doubtful the Thai growth pace can be much higher than 2016’s 3.2%.
“We think growth in Thailand will disappoint,” Capital Economics wrote.
It said the exports will be held back by “lacklustre external demand as well as waning export competitiveness” and called the outlook for domestic demand “subdued”.
The National Economic Social and Development Board, the planner, revised up its forecast for export growth this year to 2.9% from 2.4%.
Exports, a key growth driver, grew in 2016 for the first time in four years, but Thailand faces expected protectionism and capital outflow risks as the US Federal Reserve prepares to hike rates this year.
The central bank has kept its policy rate unchanged at 1.50% since a cut in April 2015. It next reviews monetary policy on March 29.
Pivotal tourism took a hit in the 2016’s last quarter as a Thai crackdown on cheap tour packages slashed the number of visitors from China, Thailand’s biggest market.
