Thailand's Economic Outlook

BANGKOK (Reuters) – Thailand's economy is expected to grow 2.8% this year, the top end of a previous forecast range of 2.6% to 2.8%, helped by stronger exports and government spending, a leading joint business group said on Wednesday.

Export Growth

Exports, a key driver of growth, are now projected to rise 4% this year, up from a range of 2.5% to 2.9% growth seen previously, said the Joint Standing Committee on Commerce, Industry and Banking, which includes representatives from those sectors.

The baht, at around 34 per dollar, is supporting shipments, according to Sanan Angubolkul, chairman of the Thai Chamber of Commerce, who spoke at a press conference.

Flood Damage

The damage from floods in parts of the country this year is expected to reach up to 85 billion baht ($2.5 billion), or 0.6% of gross domestic product (GDP), Sanan said.

Future Growth

However, the economy is forecasted to grow 4% annually in the final quarter of this year and expand further next year, according to Sanan. "There is still a risk for the economy in 2025. No matter what, there will be a trade war," he cautioned.

The group will provide a 2025 GDP growth outlook in January. The finance ministry has predicted a 3% growth for that year.

Thailand's economy grew 3% annually in the July-September quarter of 2024, marking the fastest pace in two years, but officials and analysts see increased challenges to maintaining momentum next year.

Southeast Asia's second-largest economy expanded just 1.9% in 2023, lagging behind regional peers. It has faced struggles due to high household debt, increased borrowing costs, and sluggish demand from major trading partner China.

($1 = 34.28 baht)