Thai economy may grow 2.8% this year after formation of new government, says minister

THAILAND’S economy is expected to grow 2.8 per cent this year, helped by public consumption and investment after the formation of a new government, a deputy finance minister said on Friday (Sep 8), as exports remain weak amid slowing global demand.

Public investment and spending will also attract more private investment, while private consumption and tourism are still growing well, Deputy Finance Minister Krisada Chinavicharana said.

The 2.8 per cent growth outlook, however, will not reach the ministry’s earlier forecast of 3.5 per cent this year, he told reporters, after telling a business event that the economy might grow as forecast this year.

“But this year the economy will definitely meet the country’s growth target of 2.8 per cent” as predicted by the National and Social Development Council, the state planning agency, he said.

“The engine that is about to start is public consumption and spending, after the government formation,” Krisada said.

The new government led by Prime Minister Srettha Thavisin, who is also finance minister, seeks to revive South-east Asia’s second-largest economy and deliver on key campaign promises.

It is due to deliver its policy statement on Monday.

Thailand’s 2024 fiscal Budget will be brought up for immediate consideration, Krisada said. The 3.4 trillion baht ($130.5 billion) Budget plan was put on hold for the new administration.

The economy should perform well in 2024, helped by a government digital handout policy worth 560 billion baht, he said.

SEE ALSO

Thai coalition pledges measures to fire up economy ahead of PM vote

The government has funding sources for the scheme without issuing a special borrowing law, Krisada added.

Thailand’s economy grew 1.8 per cent in the April to June period on the year and 0.2 per cent on the quarter, sharply slowing from the previous quarter, as weak exports and investments undercut tourism strength. Last year’s growth was 2.6 per cent. REUTERS