Thailand's Economic Outlook in Six Charts
IMF News, June 8, 2018
Source details
- Canonical URL
- Thailand's Economic Outlook in Six Charts
Other formats
Bibliographic details
- Published: June 8, 2018
Economic performance and short-term outlook
- Growth is estimated at 3.9 percent in 2017—the fastest pace on an annual basis since 2013.
- Thailand’s growth momentum is expected to continue in 2018 and 2019.
- Strong growth in tourism and exports of manufacturing goods are expected to continue to sustain this momentum.
- Investment and consumption are projected to recover gradually.
Key drivers of growth
- Tourism:
- Tourism is a key driver of growth and of the large current account surplus, which stood at 10.6 percent of GDP in 2017.
- More than 34 million tourists visit Thailand yearly.
- Benefits from the tourism boom are concentrated in a few select tourist hotspots and have yet to benefit other sectors of the economy.
- Exports:
- Exports of manufacturing goods are an ongoing source of growth support.
Household sector and consumption constraints
- Household debt in the country is still high, which is one of the reasons why people are holding up spending.
- High debt resulted partly from past policies that incentivized credit growth, such as the first car loan program; these policies have now been discontinued.
- The Bank of Thailand has imposed limits on personal loans and credit card debt.
- As these debts begin to be paid off, the drag on household spending should be reduced.
Investment and fiscal policy recommendations
- Scaling up public investment can help spur domestic demand and make growth more inclusive.
- This approach is critical after the steep slowdown in private investment observed over the last five years.
- An infrastructure-based fiscal stimulus can:
- Bring in private investors.
- Raise long-run growth prospects by adding to the capital stock.
Labor force, demographics, and social policy recommendations
- Thailand faces a rapidly aging population that will shrink the labor force without policy responses.
- Promoting participation in the workforce can help ease the impact of a shrinking labor force.
- Women’s participation rate in Thailand is relatively high by international standards, but still lags that of men.
- Policy actions suggested:
- Government support for child care services to increase women’s participation in the workforce and boost labor productivity.
- Pension reform, including increasing the pensionable age and providing adequate coverage, to help increase overall labor force participation.
Structural transformation and productivity
- Thailand’s service sector is expanding.
- The government is embracing the digital revolution to boost productivity, including a recently launched national e-payment system intended to help boost tax collection efficiency.
- Policy focus extends beyond manufacturing (automobiles and electronics) to new sources of growth, including robotics, aerospace, and biotechnology.
- As automation transforms the future of work, promoting education and training initiatives can help upgrade skill-sets for today’s and tomorrow’s global job market.
Thailand's Economic Outlook in Six Charts — June 8, 2018
Content in this bundle
- การคาดการณ์เศรษฐกิจไทยในแผนภูมิทั้ง 6 หัวข้อ