Private sector lowers economic forecast amid Covid surge
The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) on Wednesday downgraded Thailand’s economic growth projection to a range of 1.5 to 3 per cent, dragged down by lower purchasing power and employment rate.
The JSCCIB’s outlook was lower than the previous one in March of 1.5 to 3.5 per cent growth after assessing the impact of the current Covid-19 outbreak.
“This projection is based on the assumption that the nation could roll out vaccines as planned, coupled with the upcoming government stimulus measures worth around 200 billion baht,” said the Federation of Thai Industries chairman, Supant Mongkolsuthree.
The JSCCIB said that the latest virus cluster would likely affect the economy for at least three months, especially domestic travel, which could further create tension around public spending.
Supant urged the government to launch more stimulus measures to help the economy recover and speed up the vaccine distribution, as the vaccine will play the most important role in improving confidence among businesses.
For 2021’s exports outlook, the JSCCIB revised up Thai exports growth from the earlier 3-5 per cent to 4-6 per cent given the recovery in trade partners’ economy, despite the shipping container shortage and high freight rates.
Kasikorn Research
In its latest research note, Kasikorn sees only 1.8-per-cent economic growth for Thailand in 2021, down from an earlier 2.6 per cent, on concerns over the new wave of Covid-19.
The current outbreak risks changing behaviour and dragging down Thai household consumption to lower than expected, even though strict control measures have not been imposed, according to Kasikorn.
The research house warned that if the inoculation is not successful and the outbreak is still uncontained in the second half of the year, the situation could worsen as Thailand will likely have fewer than 2 million tourists, leading to a contraction in tourism income.