Thailand’s economic growth is expected to expand by 3.0% to 3.5% this year, while exports would fall 1% to 0% due to the effects of the global recession, the Federation of Thai Industries said on Wednesday.
FTI president Kriangkrai Thiannukul said that the banking sector turmoil in the US and Europe, which has sparked chaos in the financial market since last month, is likely to weigh significantly on the global economy this year, despite immediate assistance from the Swiss and American governments.
When it comes to the exports industry, FTI forecasts that the sector will see a contraction in 2023 amid global slowdown despite China’s reopening of its border earlier this year. However, recent data from the industrial sector shows that China is still in a contraction zone, suggesting that demand has not yet returned to normal.
Chinese manufacturing activity dropped in March, according to a private poll released on Monday, as slowing production and weaker global demand added to concerns about a post-COVID recovery .
A housing slowdown, weakening global demand, and financial uncertainty have cast doubt on the resilience of China’s rebound, despite the first two months of the year saw modest recovery thanks to a robust rise in the services sector.
FTI also highlighted that the tourist industry will be Thailand’s main source of growth this year.
Between January 1 and March 18, 2023, Thailand welcomed 5,578,721 international visitors, which is about half of the 11.5 million tourists that arrived in the country in 2022. This generated over THB200 billion in tourism earnings in just nearly 3 months.
Thailand expected to gain at least 125 billion baht in spending during the Songkran festival in mid-April, up more than 17% from the previous year, and it would then contribute to 0.5-0.7% of GDP growth this year.
