Thailand’s Economy Set for Modest Growth in 2024 and 2025, Driven by Tourism and Exports.

Bangkok: The Thai economy is projected to experience a growth of 2.7% in 2024 and 3% in 2025, according to forecasts by the National Economic and Social Development Board (NESDB). This growth is anticipated due to a recovery in the tourism and merchandise export sectors, coupled with economic stimulus measures towards the end of the year. According to Thai News Agency, Mr. Pornchai Thiravet, Director-General of the Fiscal Policy Office and Spokesperson of the Ministry of Finance, announced that the Thai economy is expected to expand by 2.7% in 2024, continuing from a 1.9% growth in 2023. This expansion is attributed to the revival of tourism and export sectors, with an estimated 36 million foreign tourists projected to visit Thailand in 2024. Private consumption is expected to grow by 4.6%, and exports in US dollar terms are anticipated to increase by 2.9%, bolstered by opportunities for Thai entrepreneurs replacing Chinese products affected by US tariffs. The forecast also indicates that government consump tion will grow by 2.1%, while government investment will see a rise of 0.8%. However, private investment is expected to contract by 1.9%, largely due to reduced investment in machinery and equipment linked to declining sales of combustion-powered vehicles, necessitating close monitoring of the automotive industry. In terms of economic stability, headline inflation is forecasted to be 0.4%, influenced by declining global energy prices. The current account balance is projected to have a surplus of $10.3 billion, or 1.9% of GDP in 2024. Looking ahead to 2025, the Ministry of Finance anticipates a 3% economic expansion driven by private consumption, exports, tourism, and investments from both public and private sectors. Private consumption is expected to grow by 2.9%, while exports are projected to rise by 3.1%. The number of foreign tourists is expected to increase to 39 million, enhancing business confidence. Government consumption is anticipated to grow by 2.2%, supported by the 2025 budget. Investment is p oised to be a key driver, with private sector investment forecasted to grow by 2.3% due to large-scale projects promoted through BOI measures. Government investment is expected to expand by 4.7%, accelerated by major infrastructure projects such as high-speed rail and port developments, which aim to enhance competitiveness and stimulate private sector investment. Domestic inflation for 2025 is anticipated to be 1%, reflecting strong domestic demand. The current account balance is expected to remain in surplus, amounting to $10 billion or 1.7% of GDP. The Finance Ministry plans to focus on maintaining fiscal discipline, promoting sustainable economic growth, and enhancing human capital development. However, global geopolitical tensions, the US presidential election's outcome, and economic challenges like household debt and flooding pose potential risks to Thailand's economic trajectory.