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World Bank cuts Thai GDP growth outlook to 1% this year

World Bank cuts Thai GDP growth outlook to 1% this year
© Reuters. A woman walks past closed shops at the Thanon Mitr Market, amid the spread of the coronavirus disease (COVID-19), in Bangkok, Thailand, January 19, 2021. REUTERS/Chalinee Thirasupa/Files

BANGKOK (Reuters) – Thailand’s economy is forecast to grow 1% this year, down from the 2.2% projected in July, hit by a spike in COVID-19 cases and a delayed reopening to visitors, the World Bank said on Tuesday, as the country fights its biggest virus outbreak to date.

Southeast Asia’s second-biggest economy contracted 6.1% last year, its deepest slump in more than two decades, with the crucial tourism sector devastated by the impact of the pandemic.

The economy is now expected to return to its pre-pandemic level in 2023, Kiatipong Ariyapruchya, senior World Bank economist for Thailand, told a virtual briefing.

“The economic recovery to pre-COVID levels will be a year slower than previously expected in 2022,” he said, adding that was based on an assumption that Thailand would reach 70% vaccination rates in the first half of 2022.

After recording 40 million foreign tourists in 2019, Thailand is now expected to receive only 160,000 this year, down from the 600,000 arrivals projected in July, Kiatipong said.

Tourist arrivals are seen at 1.7 million next year, when the economy is forecast to grow 3.6%, he added.

Exports and fiscal measures had provided support in the meantime and the World Bank backed the government’s lifting of the public debt ceiling to help the economy, Kiatipong said.

The World Bank’ 2021 economic outlook compared with growth of 1.3% predicted by the finance ministry and 0.7% by the central bank.

Source: Investing.com

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