Thailand’s Economic Growth Momentum Accelerated Slightly in 2Q

Thailand’s economic growth slowed in the three months to June, new figures released Monday showed, days after a string of bomb and arson attacks struck the country’s crucial tourism sector.

From a year earlier, growth was 3.5 per cent, better than January-March’s 3.2 per cent previously and the highest in 13 quarters.

Sequentially, Thailand’s GDP expanded 0.8%, compared with a revised 1.0% quarter-on-quarter rise registered in the first three months of 2016. A poll had forecast 0.5 per cent.

A series of bomb attacks on August 11 and 12 that hit several of the country’s well-known resorts, including Phuket, Krabi and Hua Hin, will have only a temporary impact on the econony and will not affect the full-year figures, Porametee Vimolsiri, deputy secretary-general of the NESDB, told reporters in Bangkok on Monday. It gained as much as 0.2 per cent to 34.685 per USA dollar, its strongest since July 22, 2015, after the data. High household debt, meanwhile, has restrained consumption.

In the first half of the year, the economy grew 3.4 percent. The economic forecasting unit raised its estimate for tourist arrivals to 33.5 million this year, from an earlier estimate of 33 million.

In a bid to spur activity, the junta has introduced stimulus measures and ramped up investment, although big infrastructure projects have been slow to get started.

Benjamin Shatil, Asean economist at JPMorgan, said that looking beyond support from tourism and state spending, there’s still “a fragile base for activity in the Thai economy”.

Mr Paramethi, however, pointed out that global economy after Britain’s exit from the European Union might cause baht fluctuations and affect exports which, by yearend, may shrink 1.9 percent for the whole year. “We expect Thailand’s growth to ease further in 2017, to 2.5%”, Tan wrote.