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Thai Economy Now Seen Growing 1.5% in 2021

Khlong Toey Port in Bangkok. (Photo: Bangkok Herald)
Khlong Toey Port in Bangkok. (Photo: Bangkok Herald)

The University of the Thai Chamber of Commerce’s economic forecasting center now expects the economy to expand by 1.5 percent this year, owing to various government measures to stimulate the economy. That’s higher than a projection released just a week ago.

UTCC President Thanavath Phonvichai, who is the chief advisor to the university’s Center for Economic and Business Forecasting, said the economy had already moved on from its lowest point and was entering recovery. He said recovery is expected to be clearly observed in second quarter of 2022.

Thanavath noted that there was no tendency for Covid-19 infection numbers to rise despite the relaxation of coronavirus restrictions and the reopening of the country to international tourists.

An estimated 200,000 to 300,000 foreign tourists were now expected to enter Thailand this year and contribute to approximately 12 billion baht of income.

He also took note of money circulation attributable to government measures to stimulate the economy, namely the Shop Dee Mee Khuen tax rebate program and the co-pay subsidized purchase campaign.

He explained that the aforementioned contributors, taken into consideration with income from the export sector, which was expected to grow by 16.5 percent this year, meant the economy would expand by 1.5 percent in 2021.

Dr. Thanavath forecast that GDP would expand by 4.2 percent in 2022, or within the range of 3.6-4.5 percent. Growth would become more apparent in the latter half of 2022 when the industrial sector would have recovered. About 5 million foreign tourists are expected to arrive in 2022, generating roughly 300 billion baht for the economy and benefitting employment in the manufacturing and service sectors. Meanwhile, exports are expected to grow by just 5.4 percent in 2022 because of the high base value in 2021.

The UTCC president suggested that the government continue to issue measures to stimulate the economy and use at least 500 billion baht of funds for this purpose in the first half of 2022. He singled out the Co-pay scheme, saying that another 1,500 baht in stipend should be provided to the program participants so as to stimulate the economy in the first quarter.