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Thailand’s government on Tuesday revised down the country’s economic growth projection for 2022, due to concerns over fallout from the Russia-Ukraine war and the Covid-19 outbreak situation in China.
The National Economic and Social Development Council, the government planning unit, lowered its growth outlook of Thailand’s gross domestic product (GDP) to 2.5 – 3.5 per cent, down from 3.5 – 4.5 per cent in February.
“The Thai economy is vulnerable to the prolonged war in Ukraine, which is driving global energy prices and inflation,” NESDC secretary-general Danucha Pichayanan told a briefing.
“There are still risks from high household debts, especially bad debts,” Danucha noted. He also said the outbreak situation in China will likely have some impact on Thailand’s export market.
Despite the cut in the full-year outlook, NESDC reported a better-than-expected GDP growth of 2.2 per cent year-on-year in the first quarter this year, thanks to the easing of Covid-19 restrictions. The quarterly growth beat Bloomberg’s estimate at 1.7 per cent growth.
Compared to the previous quarter, the GDP also grew by 1.1 per cent.
As Thailand’s inflation rate has hit a decade high, the NESDC raised its headline inflation projection for 2022 to 4.2 – 5.2 per cent, a big jump from 1.5 – 2.5 per cent in February.
Following the release of GDP, the Stock Exchange of Thailand (SET) index rose by 14 points to nearly 1,600 in the morning session.