Thai Economy Rebounds In Q4

Thailand’s economy rebounded at a faster-than-expected pace in the fourth quarter, underpinned by foreign demand and government spending, the National Economic and Social Development Council said on Monday.

Gross domestic product grew 1.9 percent on a yearly basis, reversing the 0.2 percent fall in the third quarter. The rate also exceeded the economists’ forecast of +0.7 percent.

Quarter-on-quarter, GDP expanded 1.8 percent, following a 0.9 percent fall a quarter ago. GDP was forecast to climb 1.4 percent.

The improvement was driven by domestic and external demand for goods and services and various measures to stimulate the economy, the office said.

The expenditure-side breakdown showed that private consumption expenditures increased 0.3 percent. Government spending grew favorably by 8.1 percent, accelerating from a 1.5 percent growth in the previous quarter.

Meanwhile, investment dropped 0.2 percent. Exports and imports were up 17.7 percent and 16.6 percent, respectively.

Overall, GDP increased by 1.6 percent in 2021, improving from a fall of 6.2 percent in 2020.

The NESDB forecast the economy to expand in the range of 3.5 – 4.5 percent, mainly supported by the regaining in domestic demand, the recovery of domestic tourism, the continual expansion of export of goods, and the support from public investment.

Headline inflation is projected to be in the range of 1.5 – 2.5 percent and the current account is forecast to record a surplus of 1.5 percent of GDP.

While a sustained recovery in the tourism sector is expected to get underway this year, arrivals will still be far fewer than pre-pandemic, meaning the overall economic recovery will remain weak, Gareth Leather and Alex Holmes, economists at Capital Economics, said.

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