Thailand’s gross domestic product (GDP) is predicted by Fitch to expand by 3.0% in 2023, which is a decrease from its earlier forecast of 3.2%. This is well below the Bank of Thailand’s prediction of 3.6% as well as the average growth rate of 3.4% for peers with ratings of “BBB.”
Inflationary pressures are increasing, and global growth is slower.
The downward adjustment reflects Fitch’s assessment that the Covid-19 pandemic’s aftereffects, growing inflationary pressures, and slower global growth will make Thailand’s economic recovery less robust than initially projected.
Fitch also points out that there won’t be much budgetary room left for any stimulus measures because Thailand’s public debt ratio will remain high by 2024, at around 56% of GDP.
favorable elements that can promote Thailand’s growth
Fitch does recognize, however, that there are some favorable aspects that might help Thailand’s economic prospects over the medium term. The sound external position, the solid macroeconomic policy framework, and the slow but steady recovery of inbound tourism are some of these.
In 2023, Fitch projects that there will be roughly 24 million visitors, or 60% more than there were before the outbreak. Additionally, Fitch confirms Thailand’s long-term foreign currency issuer default rating at ‘BBB+’ with a stable outlook, suggesting a low default risk and strong credit quality.
