Thai government slightly raises 2025 growth forecast to 2.2%
Vietnam and Indonesia now face US tariffs of 20% and 19%, respectively, much lower than the levels announced in April
[BANGKOK] A strong first half of 2025 has Thailand’s economy on track to grow 2.2 per cent this year, slightly higher than a previous forecast of 2.1 per cent, the finance ministry said on Wednesday (Jul 30), although it cautioned US tariffs could see momentum slow later this year.
Exports, a key driver of Thai growth, are expected to rise 5.5 per cent this year, up from an earlier forecast of 2.3 per cent, Pornchai Thiraveja, head of the finance ministry’s fiscal policy office, told a press conference.
“In the first half of the year, the economy expanded well, for the second half, we must monitor the impact of US tariffs,” he said, adding forecasts were based on US tariff rates of 15 to 36 per cent. The estimated impact of border conflict with Cambodia is limited to local property damage, he said, adding the border trade value between the two countries was just over 1 per cent of total exports.
There could be some impact on labour as Cambodian workers account for about 12 per cent of migrant workers in Thailand, but businesses are expected to find replacement labourers, Pornchai said. In June, the Bank of Thailand lifted its central-case growth forecast to 2.3 per cent for 2025, almost matching last year’s 2.5 per cent.
Thailand faces a potential 36 per cent tariff on its exports to the United States, its biggest export market, if a deal cannot be reached before Aug 1. On Tuesday, Finance Minister Pichai Chunhavajira said he expected talks with Washington to be concluded before Aug 1, and expected the tariff rate to be below 36 per cent.
He has said tariff rates on Thailand were expected to align with other countries in the region.
Vietnam and Indonesia now face US tariffs of 20 per cent and 19 per cent, respectively, much lower than the levels announced in April.
The finance ministry lowered its forecast for foreign tourist arrivals, another key driver of growth, to 34.5 million this year from a previous estimate of 36.5 million.
In 2019, before the pandemic, Thailand had a record of nearly 40 million visitors. REUTERS
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