BANGKOK: Thailand, Southeast Asia’s second-largest economy, has cut its 2020 economic growth projection after seeing it plodding at the slowest pace in five year in 2019.
The Thai National Economic and Social Development Council (NESDC) downgraded its forecast for 2020 to 1.5%-2.5% from 2.7%-3.7% over concerns regarding the Covid-19 outbreak, slowed exports and uncertainties in the global economy.
Thailand also lowered its exports growth to 1.4% from the 2.3% projected in November.
NESDC secretary-general Tossaporn Sirisamphan said the economy grew 2.4% in 2019, the slowest since 2014.
The Gross Domestic Product (GDP) in the fourth quarter of 2019 expanded 1.6%, decelerating from 2.6% in 3Q19 following decreasing exports, government final consumption expenditure and public investment.
“The economy grew 0.2% on a year-on-year basis in the October-December quarter, less than the forecast 0.4% growth,” he told a press briefing here today.
Sirisamphan said the Covid-19 outbreak is expected to hit the Thai tourism sector, reducing the number of tourist arrivals in the kingdom to 37 million this year from 39.8 million last year based on the assumption that the outbreak ends in June, but “the growth may come in lower than 1.5% if the epidemic continues.”
Other factors that would weigh on the kingdom’s economic growth that he cited are the impact of the drought, delay in budget disbursement and uncertainties in the global economy.
The Tourism Authority of Thailand expects foreign visitors to fall by five million this year and the loss in revenue could hit 500 billion baht.
Many analysts expect the Bank of Thailand (BoT) to further cut its policy rate to strengthen the country’s economic growth.
On Feb 5, BoT announced a policy rate cut for the third time in six months following concerns over slow economic growth due to the Covid-19 outbreak and delay in parliamentary approval of the fiscal 2020 Budget bill.
The BoT will next review the monetary policy on March 25. – Feb 17, 2020, Bernama