Thai business group maintains growth outlook at 2.8%-3.3%, urges stimulus and rate cut

THAILAND’S economy is expected to grow 2.8 to 3.3 per cent this year, but remains at risk from weak exports and domestic demand and is in need of stimulus measures and lower interest rates, a leading joint business group said on Wednesday (Apr 3).

The growth projection by the Joint Standing Committee on Commerce, Industry and Banking, which includes representatives from those sectors, was in line with its earlier forecast. The economy grew 1.9 per cent last year.

Exports, key driver of the Thai economy, are projected to rise 2 to 3 per cent this year, the group said, also in line with forecast.

The business group also maintained its inflation outlook at 0.7 to 1.2 per cent seen in March.

Southeast Asia’s second-largest economy unexpectedly shrank 0.6 per cent in the final quarter of 2023 from the third, with full-year growth at 1.9 per cent, lower than the 2.5 per cent growth in 2022.

Last month, the central bank lowered its 2024 growth outlook to 2.5 to 3 per cent, from 3.2 per cent before.

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The group’s remarks comes as the government rushes to find funding for its 500 billion baht (S$18.4 billion) signature scheme to transfer 10,000 baht to 50 million Thais to be spent in their local communities via a digital wallet.

The programme has been delayed to the fourth quarter this year. Some experts have called the policy fiscally irresponsible.

Prime Minister Srettha Thavisin, who is also finance minister, has repeatedly called on the central bank to reduce key rates. The Bank of Thailand will review key interest rates next week. REUTERS