(Jan 27): Thailand’s economy is poised to expand at its slowest pace in three years in 2026 as exports and domestic demand moderate, according to its finance ministry.
Gross domestic product is forecast to expand 2.2% in 2025, the ministry said Tuesday (Jan 27), cutting its earlier estimate of 2.4%. That would mark a deceleration from the 2.5% growth in 2024.
The ministry maintained its 2026 forecast of a 2% expansion, which is faster than the Bank of Thailand’s 1.5% growth estimate. Economists in a Bloomberg survey expect the economy to grow at 1.7%.
Should the weaker outlook materialise, Thailand would record its weakest growth since 2014, outside the pandemic years of 2020 and 2021. That’s a challenge facing Thai Prime Minister Anutin Charnvirakul, who rolled out consumption stimulus measures before dissolving parliament and is now seeking to return to power after the Feb 8 election.
The outlook is clouded by multiple headwinds, including US trade policies, a surging baht and weakening domestic demand. Government spending, which typically helps support local activity, is likely to be subdued at least in the first half, as coalition talks following the election may delay the formation of a new administration.
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Merchandise exports this year will likely increase by 1% compared with the forecast 12.7% growth in 2025. Growth in private consumption will likely slow to 2.5% from a forecast of 3.3% in 2025, according to estimates from the ministry.
The baht has gained more than 8% over the past 12 months, making it the second-best performer among Asian currencies tracked by Bloomberg. Its strength — amplified by dollar selling linked to gold trading — has weighed on exports and tourism, adding another drag on growth. The rally has prompted authorities to tighten oversight of baht-denominated bullion transactions in an effort to curb speculative flows.
The finance ministry said GDP growth in the fourth quarter was likely at 1.8% from a year ago. The country’s official growth figures are due on Feb 16.
Uploaded by Arion Yeow
