Thailand’s economy likely picked up speed in the first quarter aided by a strong recovery in the tourism sector and a rebound in private consumption, but a weakening global economy poses the biggest risk to the outlook, a Reuters poll found.
The tourism-reliant economy’s recovery has lagged its regional peers due to the COVID-19 pandemic, but turned a corner with the return of Chinese tourists in recent months boosting employment and domestic demand.
Thailand’s economy grew 2.3 percent in the January-March quarter from a year ago, up from 1.4 percent growth in the prior quarter, according to the median forecast of 20 economists polled May 8-11.
On a quarterly basis, gross domestic product (GDP) was forecast to have grown a seasonally-adjusted 1.7 percent, after contracting 1.5 percent in the previous quarter, the survey showed.
Forecasts ranged from 0.4 percent to 2.3 percent for the data due to be released on May 15.
“Growth was mainly driven by the ongoing recovery in foreign tourism as Chinese visitors began to make a comeback following China’s reopening, as well as private consumption boost,” noted Han Teng Chua, an economist at DBS.
“That said, given the still-challenging global external environment…net goods trade was likely a drag to headline growth in 1Q23, even though to a smaller extent than in 4Q22.”
Thailand beat its target of 6 million tourist arrivals in the first quarter, recording 6.15 million visitors between January and late March, government data showed.
A sharp fall in inflation from a 14-year peak of 7.86 percent in August last year to 2.67 percent last month has also helped boost consumer spending.
Growth was expected to average 3.7 percent this year, slightly above the Bank of Thailand’s (BOT) estimate of 3.6 percent. It was then forecast to rise to 3.8 percent in 2024, a separate Reuters poll showed.
