Abstract
SCB EIC forecasts Thailand’s GDP growth at 1.8% in 2025, slowing further to 1.5% in 2026 due to rising domestic and external pressures, including trade tensions and currency appreciation. Exports are projected to decline amid increasing U.S. tariffs, while the labor market struggles with unemployment and low SME revenues. Fiscal constraints threaten stability, with public debt nearing 70%. The MPC is expected to cut interest rates to stimulate economic activity. Key policies should focus on stabilization, stimulation, and structural reforms to enhance competitiveness and attract foreign investment.
Summary
Economic Outlook for Thailand
SCB EIC forecasts Thailand’s GDP growth at 1.8% in 2025, dipping to 1.5% in 2026. The second half of 2025 may see growth under 1%, raising the risk of a technical recession. External and domestic pressures are mounting, primarily due to diminishing demand and tighter fiscal constraints. Trade tensions, particularly U.S. tariffs, are straining Thai exports, while a strong baht further complicates the economic landscape by diminishing tourism competitiveness.
Internal Economic Challenges
The domestic economy is increasingly fragile, with SMEs struggling to return to pre-COVID revenue levels and the labor market facing rising unemployment. Public debt is nearing 70%, presenting additional fiscal risks. The new government is urged to stabilize the economy through clear policies, stimulate growth with fiscal measures, and pursue structural reforms that support business development and innovation.
Focus on Foreign Investment
Despite global trade uncertainties, Thailand’s FDI remains promising, especially in sectors like data centers and sustainable food. However, competition from countries like Vietnam poses challenges. The Thai government must streamline regulations and create an investment-friendly environment to attract FDI, thereby facilitating growth in strategic industries and enhancing integration into global supply chains.
Source : Outlook quarter 3/2025
