BOT says Thai economic potential drops to 2.7% as SMEs slump

Khaosod•Economy•10d ago

Reader Briefing

The Bank of Thailand reports that Thailand's economic potential has declined to 2.7% due to structural issues and a prolonged slump in SMEs.

•Bank of Thailand Assistant Governor Don Nakornthap states Thai economic potential has fallen from 5% (2003-2007) to 2.7%.
•SMEs have experienced a contraction for 16 consecutive quarters, or 4 years.
•The Bank of Thailand forecasts GDP growth of 2.3% for 2026 and 1.8% for 2027.

•The Bank of Thailand reports Thai economic potential decreased from 5% during 2003-2007 to 3.5% after the global financial crisis, and currently to 2.7%.
•Don Nakornthap attributes the decline to three main factors: labor contraction from an aging society, decreased investment, and slow Total Factor Productivity (TFP) growth.
•Structural obstacles affecting long-term growth include competition from Chinese goods, high household debt, aging society, education quality, asset inequality, corruption, and political stability.
•SME retail sales decreased by 7.1%, while large businesses grew by 9.6%, indicating concentrated economic growth.
•Don Nakornthap warns that SMEs have contracted for 16 consecutive quarters, a situation not seen since the 1997 crisis.
•Current inflation is at 2.5% with an upward trend expected late in the year due to El Nino affecting fresh food prices.
•Don Nakornthap asserts that driving the economy requires coordination between the government's fiscal policy and the private sector, not just the Bank of Thailand.

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Don Nakornthap

"Do not expect too much from the BOT because a single agency cannot do much. If relying solely on the BOT, the nation will not move forward."

อย่าคาดหวังจาก ธปท.มากนัก เพราะหน่วยงานเดียวทำอะไรมากไม่ได้ หากหวังพึ่ง ธปท.คนเดียว ประเทศชาติจะยังไม่ไปไหน

Don Nakornthap(ดอน นาครทรรพ)

Assistant Governor for Monetary Policy at the Bank of Thailand.

Bank of Thailand(ธนาคารแห่งประเทศไทย)ℹ️

The central bank of Thailand responsible for monetary policy.

BOT(ธปท.)

Abbreviation for the Bank of Thailand.