World Bank Sees Thai Economy to Return to Pre-Pandemic Levels This Year, but Cut Its Growth Forecast for 2023

Thailand’s economy is expected to expand by 3.4% this year and 3.6% next year, but the pace of growth will be slower-than-expected, while tourism recovery and private consumption remain key drivers.

The bank sees the Thai economy returning to its pre-pandemic level this year, but global headwinds remain.

The Thai economy has shown resilience to recent global shocks. Following the economic reopening in May and the government’ measures to relieve cost-of-living pressures, economic growth surged to 4.5% in the third quarter of this year, fueled by rising private spending and high tourism inflows. However, when compared to other Southeast Asian countries such as Vietnam, Thailand is anticipated to grow at a slower rate.

Meanwhile, exports are expected to contract by 2.1% in 2023, a sharp decline from the estimated expansion of 8.1% in 2022. This negative estimate reflects weaker demand from major trading partners like China, the European Union, and the United States.

“As Thailand looks towards resuming its path towards high-income country status post-pandemic, raising adequate fiscal space will be necessary to meet the additional spending need and provide a fiscal buffer for future shocks,” said Fabrizio Zarcone, World Bank Country Manager for Thailand.