Bangkok: NESDB reveals that GDP in Q4/67 grew by 3.2%, supporting the whole year to grow by 2.5%. It is expected that in 68, it will grow by 2.3-3.3% from supporting factors such as increased government spending, tourism recovery, and export expansion. Keep an eye on trade protectionist policies that will drag GDP down to less than 3%. It reveals that the government has 157 billion baht left, proposing to distribute investment in water management in the second half of the year.
According to Thai News Agency, Mr. Danucha Pichayanan, Secretary-General of the National Economic and Social Development Council (NESDB), stated that the Thai economy in the fourth quarter of 2024 expanded by 3.2%, an improvement from the third quarter's 3% growth. This growth was fueled by increases in government investment, exports, and private consumption, alongside the agricultural sector's return to positive territory after five quarters. However, private investment saw a decline, particularly in the automobile and real estate sectors, due to restrictive lending aimed at addressing high household debt levels.
For the year 2024, GDP is anticipated to grow by 2.5%, up from 2.0% in 2023. This growth is expected to be driven by enhanced government spending and investment, a thriving tourism sector, and rising private consumption and merchandise exports.
In terms of economic stability, the inflation rate in 2024 is projected at 0.4%, a decrease from 1.2% in 2023. The unemployment rate is expected to remain low at 1%, with the current account balance at 2.3%, continuing its upward trend from 1.5% in 2023.
Looking ahead to 2025, GDP growth is forecasted to range between 2.3% and 3.3%, supported by ongoing government spending and improvements in private consumption and investment. The tourism and export sectors are also expected to contribute to this growth.
However, there are significant risk factors, including potential impacts from US trade policies like increased import tariffs and customs taxes, which could lower GDP growth below 3%. Additionally, household and business debt levels and fluctuations in agricultural output and prices pose risks.
Mr. Danucha emphasized that the GDP forecast for 2025, which includes measures like a 10,000 baht handout, hinges on addressing global trade policy risks. To achieve the government's ambitious 3.5% GDP growth target, further investment and consumption stimulation, particularly in private and government sectors, are deemed necessary.
To boost economic stability, timely economic stimulus measures and strategic use of remaining funds are crucial. With approximately 157 billion baht available post-handout, the second half of the year is seen as an opportune time for government investment in small-scale water management projects across the country, which could bolster long-term economic growth and address disaster management issues.
For dealing with potential policy shifts under a Trump administration, the government is advised to accelerate investment promotions, bolster the export sector, and continuously support the tourism industry.