BANGKOK – Thailand’s economy returned to growth in the fourth quarter, rebounding more quickly than expected, on robust exports and a recovery in domestic activity following an easing of Covid-19 curbs and as borders reopened to foreign visitors.
The government maintained its economic growth outlook at 3.5 per cent-4.5 per cent, counting on a limited impact from the Omicron-driven coronavirus outbreak, stronger domestic demand, a recovery in tourism and continued support from exports and public investment.
In 2021, Thailand’s economy grew 1.6 per cent, one of the slowest in South-east Asia, after a 6.1 per cent contraction in 2020.
South-east Asia’s second-largest economy expanded a seasonally adjusted 1.8 per cent in the December quarter from the previous three months, data from the National Economic and Social Development Council showed on Monday (Feb 21), outstripping a forecast 1.4 per cent increase in a Reuters poll, and after a revised seasonally adjusted 0.9 per cent contraction in the third quarter.
The economy is likely to perform well in the first quarter of this year, based on indicators so far, but there is some inflationary pressure, NESDC chief Danucha Pichayanan told a news conference.
“The main driver will be exports and fiscal disbursement, with tourism and domestic consumption adding to the support,” he said.
From a year earlier, gross domestic product (GDP) grew 1.9 per cent in October-December, beating a forecast 0.7 per cent rise, and against a revised 0.2 per cent contraction in the previous three months.
Exports, a key driver of Thai growth, jumped 21.3 per cent in the December quarter from a year earlier while private consumption rose 0.3 per cent. There were about 340,000 foreign tourists in the fourth quarter of 2021, up from 45,000 in the previous three months.
Thailand resumed a quarantine waiver for foreign tourists this month to help revive its vital tourism sector, which normally accounts for about 12 per cent of Thai GDP.
The state planning agency expected 5.5 million tourists in 2022, up from a forecast of 5 million in November. But that’s still well below 40 million foreign tourists in 2019, suggesting the economic recovery will be slow and uneven.
The agency maintained its forecast export growth at 4.9 per cent this year.
The government has introduced billions of dollars of relief measures to revive the economy while the central bank has left its key rate unchanged at a record low of 0.50 per cent since May 2020.