Thailand’s Finance Ministry on Thursday slashed for the second time around its economic growth forecast for the year as the global pandemic continues to dent the country heavily reliant on the tourism industry.
According to a report by Bangkok Post, the Finance Ministry’s Fiscal Policy Office (FPO) lowered its growth forecast to only 2.3 percent from the earlier projection of 2.8 percent and 4.5 percent in January 2021 and October 2020, respectively.
FPO Director-General Kulaya Tantitemit said that the forecast was based on assumptions that the government will come up with new stimulus measures to revive the ailing economy worth not less than 100 billion baht in the current fiscal year ending September 30.
“If the government’s new economic rehabilitation measures are worth more than 100 billion baht, the FPO is set to take such figures into account in a new economic growth forecast,” she said.
Tantitemit underscored that the economy is likely to recover beginning the fourth quarter of the year, with full-year figures expected to stay between the 1.8- to the 2.8-percent range or an average of 2.3 percent.
“Although the world’s recovering economy is a positive for Thai export prospects which are expected to grow by 11 percent in US dollar terms this year from 6.6 percent contraction last year, Thailand’s overall economy is still feeling the pinch from a fresh wave of infections and relatively slow vaccine rollout,” Tantitemit said.
This has prompted the number of expected international tourist arrivals to plunge to only two million this year, translating to a sharp fall from five million people earlier projected in January.
Thailand’s international market makes up for 12 percent of its gross domestic product., with China its top market. It saw a plunge in foreign tourist arrivals since last year amid the virus outbreak which originated in Wuhan, China.
Last year, Thailand saw tourist arrivals at only 6.7 million, translating to an 83.2 percent drop in revenues of about 330 billion baht, from the 2 trillion baht recorded in 2019.