Thai Economy Risks Sub-1% Growth in H1 Due to Debt, Slowing Exports

Thansettakij•Economy•1d ago

Reader Briefing

Thailand's economic growth is projected to fall below 1% in the first half of the year due to a combination of high household debt, weakening exports, and fragile domestic purchasing power, according to an economic analyst.

•Thai economy is expected to grow less than 1% in the first half of the year.
•Key contributing factors include high household debt, slowing exports, and weak domestic demand.
•Interest rate cuts are recommended to stimulate economic recovery.
•The formation of a new government by May will impact the disbursement of the fiscal year 2027 budget.

Overview

•Anont Siranond, former Dean of the Faculty of Economics at the University of the Thai Chamber of Commerce, predicts that the Thai economy may expand by less than 1% in the first half of the year.
•This projection is due to pressure from high household debt, tight liquidity, slowing exports, and weak domestic purchasing power, even with a slight recovery in tourism.
•Anont Siranond recommends that the policy interest rate should be lowered to 1% to support economic recovery.
•The Bhumjaithai Party, a key leader in government formation, has policies involving subsidies, which require careful budget management as public debt continues to rise.
•The Bhumjaithai Party's "10 Plus" policy aiming for GDP growth above 2-3% this year may face fiscal constraints, with public debt to GDP potentially exceeding the 70% ceiling in the next 1-2 years.
•If the new government is formed by May, the fiscal year 2027 budget will be delayed by approximately 1-2 months, which is not expected to significantly impact the overall economy.
•Despite export growth being the highest in 4 years in fiscal year 2025, the Thai economy experienced limited benefits due to a substantial trade deficit of -5,307.9 million USD.
•Thailand's export sector is predicted to contract this year due to global trade volume expansion estimated at only 2.3-2.6%, the clearer impact of US tariffs, and high base effects, along with a high reliance on imports in Thailand's export structure.

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Key Quotes

Anont Siranond

"The policy interest rate should be lowered to 1% to support economic recovery."

อัตราดอกเบี้ยนโยบายควรปรับลงมาสู่ระดับ 1% เพื่อสนับสนุนการฟื้นตัวทางเศรษฐกิจ

Anont Siranond

"The Bhumjaithai Party's '10 Plus' policy aiming for GDP growth above 2-3% this year may face fiscal constraints due to public debt to GDP potentially exceeding 70% in the next 1-2 years."

นโยบาย 10 พลัสของพรรคภูมิใจไทยที่ต้องการผลักดันให้จีดีพีมากกว่า 2-3% ในปีนี้อาจเผชิญข้อจำกัดทางการคลังจากสัดส่วนหนี้สาธารณะต่อจีดีพีที่อาจทะลุเพดาน 70% ได้ใน 1-2 ปีข้างหน้า

Anont Siranond

"If the new government is formed by May, the fiscal year 2027 budget will be delayed by about 1-2 months, which will not affect the overall economy."

หากรัฐบาลใหม่จัดตั้งได้ภายในเดือน พ.ค. งบปีพ.ศ. 2027 จะล่าช้าประมาณ 1-2 เดือน ยังไม่กระทบเศรษฐกิจภาพรวม

Anont Siranond

"Although export growth in fiscal year 2025 was the highest in 4 years, the Thai economy benefited limitedly from exports because Thailand had a high trade deficit of -5,307.9 million dollars."

แม้อัตราการขยายตัวส่งออกปี พ.ศ. 2025 สูงสุดในรอบ 4 ปีแต่เศรษฐกิจไทยได้รับประโยชน์จากการส่งออกจำกัด เพราะไทยขาดดุลการค้าสูงถึง -5,307.9 ล้านดอลลาร์

Anont Siranond

"It is expected that Thailand's export sector this year may contract, as global trade volume may only expand by 2.3-2.6%."

โดยคาดว่าภาคส่งออกไทยปีนี้อาจขยายตัวติดลบเพราะปริมาณการค้าโลกอาจขยายตัวเพียง 2.3-2.6%

Key Entities

Person

Anont Siranond(นายอนุสรณ์ ธรรมใจ)

Former Dean of the Faculty of Economics at the University of the Thai Chamber of Commerce and former member of the Public Debt Management Committee, Ministry of Finance.

Organization

University of the Thai Chamber of Commerce(ม. หอการค้าไทย)ℹ️

Institution where Anont Siranond formerly served as Dean of the Faculty of Economics.

Ministry of Finance(กระทรวงการคลัง)ℹ️

Government ministry that Anont Siranond formerly served on the Public Debt Management Committee.

Bhumjaithai Party(พรรคภูมิใจไทย)ℹ️

Political party described as a key leader in government formation, with stated policies on subsidies.