Thailand’s economy is slowing as exports and manufacturing decline

Thailand’s economic development slowed faster than anticipated in the fourth quarter of 2022 due to a decrease in exports and manufacturing, but a resurgence in the crucial tourism industry could continue to bolster the recovery this year despite a decline in global demand.

Friday’s report from the National Economic and Social Development Council (NESDC) indicated that the GDP of the second-largest country in Southeast Asia grew by 1.4% from October to December of last year.

In October-December, the gross domestic product (GDP) decreased by 1.5 percent on a quarterly basis, below estimates for a gain of 0.5 percent.

The tourism-dependent economy increased by 2.6% in 2022, after expanding by 1.5% in 2021, which was one of the slowest growth rates in Southeast Asia.

Despite the sluggish fourth quarter, the economic recovery is anticipated to gain some pace, with China’s earlier-than-anticipated reopening providing a further boost to the tourist sector and offsetting some of the impact of declining exports.

The NESDC anticipated the economy will increase between 2.7% and 3.7% this year, a decrease from its earlier prediction of 3% to 4% growth.

With the return of Chinese tourists, the agency now anticipates that Thailand will welcome 28 million international tourists this year, up from the former projection of 23.5 million.

With 11.15 million international tourists in 2022, Thailand surpassed its tourism goal. It had a record number of approximately 40 million tourists prior to the 2019 pandemic, who spent $1.91 trillion baht ($55.75 billion).

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