The Asian Development Bank (ADB) has increased Thailand's economic growth in 2023** from 35% to 25 per cent, citing contraction in exports, lower spending and lower public and private sector investment.
ADB also raised Thailand's economic growth forecast for next year from 3 due to the global economic slowdown7% to 33%。
The bank reported that the outlook for developing countries in Asia remains positive despite global challenges. Inflation in the region is expected to rise from 4 last year4% down to 35% and then rises slightly to 3 in 20246%。
Downside risks are mainly related to prolonged high interest rates in advanced economies, which could trigger financial instability.
The disruptions that could be caused by El Niño and Russia's invasion of Ukraine could once again pose energy and food security challenges, reigniting inflation, the report said.
In addition, the Thai economy is facing multiple challenges:
**Downside:
Thailand** fell to its lowest point since November 18, 2020 due to a massive sell-off by foreign investors.
The tourism industry is not strong enough
The Director General of the Tourism Authority of Thailand (TAT) said that as of December 3, the number of foreigners visiting Thailand increased to 25.08 million, creating 11 trillion baht in revenue.
Thailand is expected to receive a total of 27 million tourists this year, below the target set by the Tourism Authority of Thailand, the director said. The country is heavily dependent on exports and tourism revenues.
Doubts about digital wallet schemes
The Bank of Thailand (BOT) has downgraded economic growth** to 2 this year4%, but it is expected to grow by 3 percent next year2%。However, if 500 billion baht can be borrowed to fund the digital wallet initiative, the economy will grow by 38%。
The digital wallet program will distribute 10,000 baht each to 50 million citizens aged 16 and above and aims to boost local spending.
However, there is uncertainty about the plan and there is even a possibility that it will not be approved by Parliament or will be blocked by the Constitutional Court for violating the Constitution and the State Fiscal and Financial Discipline Act.
Boost consumption
The move to raise the daily minimum wage is awaiting approval from the Cabinet. All indicators point to a lower wage range than the Pheu Thai Party promised by May 14.
Inflation is unlikely to be an issue next year, as the central bank** headline inflation is between 2% and 22%, up from this year's estimate of 13%。Core inflation (excluding energy and fresh food) is expected to come in at 12% to 15% compared to 13%。
The content is organized by this look at Thailand, and the material ** Thai media Bangkok Post, khaosod
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