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Thai Economy in 2013 and Outlook in 2014

November 27, 2013 Destination Thailand No Comments Email Email

13322195144pThe Thai economy in 2013 is projected to grow by 3 percent, compared with 6.5 percent in 2012. The growth rate is likely to be around 4-5 percent in 2014.
The Secretary-General of the Office of the National Economic and Social Development Board (NESDB), Mr. Arkhom Termpittayapaisith, said that the growth projection of 3 percent is lower than 3.8-4.3 percent estimated in August 2013 because of the lower-than-expected export growth.

Auto production is unlikely to reach 2.5 million units as targeted, while the Government’s major investment plans have not reached the set target. The flooding situation also had an impact on the Thai economy. However, Mr. Arkhom said, tourism has enjoyed steady growth. It is expected that tourist arrivals in 2013 will meet the target of 26.2 million.

According to NESDB, private expenditure is expected to grow by 0.8 percent, while total investment is projected to expand by 0.9 percent. Inflation is expected to average 2.4 percent, compared to 3 percent in 2012. The current account balance will register a deficit of 0.9 percent of GDP, against a deficit of 0.4 percent in 2012.

The total export value is expected to be at the same level as it was in the previous year, lower than the previous projection of 5 percent. Deputy Prime Minister and Commerce Minister Niwattumrong Boonsongpaisan believed that Thai exports in 2013 would grow by 1 percent because of the sluggish growth of the global economy. The Ministry of Commerce is seeking new markets for Thai exports.

As for 2014, The Thai economic performance is expected to improve owing to the recovery of the global economy, which will help boost exports. The situation will also bolster household consumption and investment. Thailand’s export value will grow by 7 percent, while private consumption expenditure will increase by 2.7 percent, and private investment by 7.1 percent. Inflation is likely to be in the range of 2.1-3.1 percent, and the current account deficit will be about 0.6 percent of GDP.

NESDB indicates that, with the contribution from key government investment projects, the Thai economy in 2014 is projected to expand at a satisfactory rate. Economic stability remains sound. International tourist arrivals in 2014 are expected to reach 28 million.

Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong admitted that the Thai economic performance in 2013 would not meet the set target as a consequence of several negative external factors. He believed that the Government’s planned infrastructure development would contribute to economic growth in 2014.

According to the International Monetary Fund, Thailand’s GDP growth is projected to slow down to 3.0–3.5 percent in 2013. Public investment projects in 2014 are expected to become a key engine of growth, boosting growth to 5.2 percent. With growth driven by domestic demand, the current account surplus is expected to reach a small deficit of 0.2 percent of GDP in 2014.

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