Thai economy expands slowly in February, helped by tourism: central bank

THAILAND’S economy expanded slowly in February, with growth in the service sector and an increase in tourist arrivals offsetting a fall in exports from the previous month, the Bank of Thailand (BOT) said on Friday (Mar 29).

Thailand recorded a current account surplus of US$2 billion in February, after a deficit of US$200 million in the previous month, the BOT said.

There have been 8.73 million foreign tourist arrivals in Thailand this year up to Mar 24, up 44 per cent year on year, with visitors from China reaching 1.63 million, tourism ministry data showed.

The government is aiming for a record of 40 million foreign visitors this year, following the 28 million in 2023.

The economy in March will be helped by tourism, but export recovery and industrial manufacturing will have to be closely monitored, assistant governor Chayawadee Chai-Anant told a briefing.

The BOT is monitoring the global economic recovery, government spending and economic stimulus measures, she added.

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South-east 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.

Car production in regional autos hub Thailand fell 19.28 per cent in February from a year earlier, largely due to a decline in production of pickup trucks and more imported electric vehicles (EVs), a local industry group said.

This week, BOT governor Sethaput Suthiwartnarueput said first-quarter gross domestic product was “not likely to look pretty” but drag factors would ease later in the year, and the BOT must ensure the policy rate was appropriate for supporting long-term growth.

Despite government pressure to ease policy, the BOT last month left its key interest rate unchanged at 2.5 per cent, the highest in more than a decade, in a split vote. It will next review monetary policy on Apr 10. REUTERS