Paopoom confident GDP growth this year will exceed the 2.7% estimate

The Finance Ministry expressed confidence that Thailand’s gross domestic product (GDP) in 2024 would grow beyond the target of 2.7%, as a result of the government’s 10,000-baht handout schemes, and other policies.

Deputy Finance Minister Paopoom Rojanasakul told a seminar hosted by US-based credit rating agency Fitch Ratings, titled “Fitch on Thailand 2024: Global Risks and Regional Economic, Investment & Bank Outlook” on Thursday that Thailand’s economy was currently on an upward trend, with more growth expected in the third and fourth quarters of 2024, carrying the momentum well into 2025.

Paopoom said the seminar provided a good opportunity to show global ratings companies that Thailand’s finances and treasury were strong, and to demonstrate the kingdom’s readiness in various development aspects.

"The government has been making every effort to implement economic stimulus measures, despite the constraints posed by the delayed disbursement of the fiscal 2024 budget,” he said. “Various economic policies have already shown results in the second half of the year.”

He said Thailand’s GDP this year is expected to grow higher than the original estimate of 2.7%, due to the intensive and continuous implementation of fiscal and monetary measures, as well as the effects of the government’s economic stimulus projects, notably the 10,000-baht handout scheme to people in vulnerable groups.

“This economic momentum is expected to carry through to the second quarter of 2025, and the government is preparing fiscal and monetary tools to sustain this trend continuously throughout 2025,” said the deputy minister. 

Paopoom said that Thailand’s current public debt ratio at 64% of GDP is at a “manageable level”, adding that based on the definition of the International Monetary Fund (IMF), the ratio would be at 58.28% of GDP, which is in a middle to low level compared to the country’s trade partners.

“The potential and growth of the capital market are high, jumping from 12% of GDP during the Tom Yum Kung crisis to 94% of GDP at present,” he said. “Thailand also has a diverse range of products in the capital market, high liquidity, and a strong investor base, which are fundamental factors supporting the growth of the private sector."

Paopoom said that the Finance Ministry and the Bank of Thailand are currently working closely together to find a balance between maintaining stability and tapping the potential of the economy. The authorities are focusing on stabilising the baht to prevent excessive fluctuations, keeping inflation within target ranges, and managing the volume and strictness of loan issuance to promote national growth, he said.

Last month, the Asian Development Bank lowered its economic growth forecast for Thailand to 2.3% in 2024 and 2.7% in 2025, down from previous estimates of 2.6% and 3.0%, respectively, citing a slowdown in government spending and weaker-than-expected export recovery.