World Bank cuts Thailand’s 2023 GDP forecast to 3.4% as exports lag
The World Bank has cut its GDP growth forecast for Thailand in 2023 from 3.6% to 3.4% amid a projected slowdown in regional economies this year.
The bank also revised down Thailand's GDP forecast for next year to 3.5% from April’s estimate of 3.7%. Thailand's economic recovery is lagging behind other Asean countries, and declining exports pose an increasing challenge.
Thailand’s projected growth rates are among the lowest in the East Asia region, just ahead of civil war-torn Myanmar at 3% for 2023.
Although Thailand's GDP is expected to increase slightly next year, it will still face challenges amid the slowing growth rates in other countries, notably China.
The World Bank has maintained its 5.1% GDP growth estimate for China this year but slashed the 2024 projection for the globe's second-largest economy from 4.8% to 4.4%.
The bank noted that economic recovery in Thailand was slower than in other Asean countries and identified falling exports as an escalating challenge.
It also pinpointed rising household debt, climate-related impacts, and political uncertainties as negative risks to Thailand's economic outlook.
Thai public debt, at 60% of GDP, is not considered risky yet. However, Thailand’s household debt, at around 80% of GDP, is the highest in the region and more worrisome, the bank said.
It said Thailand faces medium-term structural challenges that limit growth potential, including an aging population, climate change, insufficient investment accumulation, declining export competitiveness, and significant household debt. Financial stress from excessive debt and the impact of climate conditions on low-income and vulnerable households remain significant obstacles to poverty reduction, it added.
