NESDC adjusts Thailand’s GDP growth projections for 2023 and 2024

[webfact]

An adjustment to the anticipated GDP growth for 2023 and 2024 has been made by the National Economic and Social Development Council (NESDC), dropping to 1.9% and 2.7% respectively. The secretary-general of NESDC, Danucha Pichayanan, has called upon the Bank of Thailand to utilise financial measures to support the economy.

 

The NESDC unveiled the figures for the economic growth in 2023, along with its prediction for 2024’s growth, both of which were lower than the previously anticipated 2.5% and 2.7-3.7% (averaging 3.2%) respectively. Danucha Pichayanan proposed that the central bank should contemplate measures to decrease interest rates, especially the net interest margin (NIM), which currently stands high at approximately 5%, to aid in the economy’s recovery.

 

Danucha mentioned, “In the recent past, the government undertook many stimulus measures to revive tourism, support investment, and expedite the disbursement of the state budget. As a next step, the government should use financial measures to support the economy.”

 

The NESDC is urging financial institutions to lower the NIM to aid small and medium-sized enterprises (SMEs) and households with their debt issues. The NIM does not, however, have a significant impact on large businesses.

Danucha further suggested that the central bank should prolong its debt assistance measures by preserving the minimum payment rate for credit card debt at 5% for some time. This measure had expired at the end of the previous year and is now at 8%, but its implementation could prevent non-performing loans (NPLs) among SMEs and households.

 

In 2023, public investment and public consumption saw a contraction of 4.6% in comparison to 2022, caused by a delay in the disbursement of the fiscal 2023 budget due to the general election. Exports of goods and services expanded by 2.1%, a decrease from 6.1% in 2022, reported Bangkok Post.

Predicted GDP growth for 2024, which is expected to expand between 2.2-3.2%, with an average of 2.7%, can be attributed to various positive factors. Public investment is expected to decrease by 1.8%, while public consumption is projected to increase by 1.5%. Private investment and consumption are expected to expand by 3.5% and 3%, respectively.

 

However, the Thai economy still faces risks in 2024 due to a delay in state budget planning, increasing household debt, drought, volatility in the global financial system, and geopolitical tensions worldwide. Moreover, China’s economic issues, primarily the liquidity crunch in its real estate sector, could potentially impact Thailand’s export sector.

 

by Alex Morgan

Photo courtesy of iStock

 

Source: The Thaiger 2024-02-20

 

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[hotchilli]

6 hours ago, webfact said:

Danucha mentioned, “In the recent past, the government undertook many stimulus measures to revive tourism, support investment, and expedite the disbursement of the state budget. As a next step, the government should use financial measures to support the economy.”

The economy is tanking, and short term stimulus measures achieve nothing.

[Mike Lister]

16 minutes ago, hotchilli said:

The economy is tanking, and short term stimulus measures achieve nothing.

I what way is the economy tanking, where and how?

[retarius]

23 minutes ago, Mike Lister said:

I what way is the economy tanking, where and how?

Come on Mike, what was the GDP when Yingluck was PM? Was it 1.7%. 1.7% would be great for a G7 country, but not for an Asian tiger. 1.7% will not fill poor people's bellies or provide good jobs.

[Srikcir]

14 minutes ago, Mike Lister said:

I what way is the economy tanking, where and how?

It's in the article. 

"... public consumption saw a contraction of 4.6% in comparison to 2022, caused by a delay in the disbursement of the fiscal 2023 budget due to the general election. Exports of goods and services of goods and services expanded by 2.1% (2023), a decrease from 6.1% in 2022... Private investment and consumption are expected to expand by 3.5% and 3%, respectively (in 2024)."

 

In other words while GDP sectors for 2023 were generally favorable compared to 2022, the projected increases and decreases for various GDP sectors in 2024 will not even get Thailand back to 2022 levels of the economy.

Focus on increasing tourism for 2024 is a political distraction and a miss on critical major GDP sectors that make up I think about 80% of total GDP. 

[Mike Lister]

14 hours ago, retarius said:

Come on Mike, what was the GDP when Yingluck was PM? Was it 1.7%. 1.7% would be great for a G7 country, but not for an Asian tiger. 1.7% will not fill poor people's bellies or provide good jobs.

Thailand's GDP growth since covid in 2020 has not been as good as it was pre-covid. Does that come a surprise to anyone given that China has still not recovered in fact, the global economy has not yet recovered.

 

With regards to Yingluk: GDP grew nicely in the years 2011 to 2014, just as it did in the years 2016 to 2019, your point being? I don't see anything in the second graph showing YoY GDP growth that is out of order, until covid in 2019, from which the global economy is still recovering.

 

 

https://tradingeconomics.com/thailand/gdp

 

https://tradingeconomics.com/thailand/gdp-growth-annual

 

 

 

 

 

[Mike Lister]

17 minutes ago, Srikcir said:

It's in the article. 

"... public consumption saw a contraction of 4.6% in comparison to 2022, caused by a delay in the disbursement of the fiscal 2023 budget due to the general election. Exports of goods and services of goods and services expanded by 2.1% (2023), a decrease from 6.1% in 2022... Private investment and consumption are expected to expand by 3.5% and 3%, respectively (in 2024)."

 

In other words while GDP sectors for 2023 were generally favorable compared to 2022, the projected increases and decreases for various GDP sectors in 2024 will not even get Thailand back to 2022 levels of the economy.

Focus on increasing tourism for 2024 is a political distraction and a miss on critical major GDP sectors that make up I think about 80% of total GDP. 

The article says that government refused to disburse the budget in December which cause d a 4th quarter drop in GDP of 0.6%. Oh look, living proof that the digital wallet giveaway is needed!

 

I agree that Tourism is a distraction, that said, January's numbers are indicative of well over 40 million, a record!

 

And exports are near their peak, they may have flatlined but they flat lined near the peak, if you're going to flat line, that's the place to do it.

 

2023 projections in a the covid recovery era.......does anyone really think it's significant they are missed, especially with government delaying disbursements and China still down and out!!!

 

 

 

[bamnutsak]

1 hour ago, Mike Lister said:

I what way is the economy tanking, where and how?

 

According to the Prime Minister/Minister of Finance today, "the latest data indicated that the country's economy was in a crisis".

 

But what does he know?

 

 

 

[Mike Lister]

17 minutes ago, bamnutsak said:

 

According to the Prime Minister/Minister of Finance today, "the latest data indicated that the country's economy was in a crisis".

 

But what does he know?

 

 

 

It is convenient to with hold the budget from distribution and therefore cause GDP growth to sink by 0.6% and cause the economy to enter the first leg of a technical recession. This demonstrates to everyone that the digital wallet giveaway really is needed, if the country is to avoid falling into the abyss! 

 

What does he know? I'm really really unsure.

[hotchilli]

16 hours ago, Mike Lister said:

I what way is the economy tanking, where and how?

Quote:

In his “X” post on Monday night, the prime minister said that the economic performance figures released by the National Economic and Social Development Council (NESDC) clearly show that the Thai economy is at a critical stage and the NESDC secretary-general agreed that it is time for a review of the policy rate.