BANGKOK: The World Bank has maintained Thailand’s economic growth forecast this year at 2.5% due to impetus from fiscal stimulus and increasing tourism revenue. But the figure remains the lowest GDP growth projection among Asean member states excluding Brunei and Singapore.
Timely implementation of public infrastructure projects this year and next can contribute to a more positive outlook for the Thai economy, said Kiatipong Ariyapruchya, the bank’s senior country economist. However, growth could be below 2.5% if fiscal disbursement in the second and third quarters cannot be accelerated, he said.
In April, the World Bank revised up Thailand’s GDP growth forecast from 2% to 2.5% on the back of state stimulus measures implemented late last year and signs of improving exports. The Bank of Thailand recently forecast economic growth will be 3.1% this year, while the Fiscal Policy Office is predicting 3.3% and the National Economic and Social Development Board 3-3.5%. GDP growth hit a three-year high of 3.2% year-on-year in the first quarter, up from the final quarter’s 2.8%, mainly attributed to government stimulus measures and rapid improvement in the tourism sector.
The prolonged economic slowdown has highlighted structural challenges such as implementing public investment, maintaining and raising export competitiveness, and addressing critical skills mismatches, said Mr Kiatipong. Implementing reforms to address these challenges will be key to stimulate long-term growth, he said.
