A higher risk of slowing exports amid a global economic slowdown will pressure Thai economic growth this year, despite positive growth of the tourism sector, says an executive of the Bank of Thailand.
Even though the tourism recovery is a key factor supporting economic expansion in 2023, Thailand's economy will feel the pressure from the export slowdown, said Chayawadee Chai-Anant, assistant governor of the central bank.
As a result, it will continue to monitor all factors and economic data that benefit and impact the country's growth this year, Ms Chayawadee said.
Exports contribute 53% to GDP, while the tourism sector accounts for around 11-12%, she said.
Foreign tourist arrivals have been on the increase, while there has been a slowdown in exports.
But the International Monetary Fund yesterday announced that it projected a better global economic growth outlook compared with its previous assessment. Therefore, the bank needs to continue to monitor a host of factors, she said.
Last week the Bank of Thailand increased its projection for foreign arrivals this year to 25.5 million, up from 22 million, with the estimate for 2024 bumped up to 34 million, from 31.5 million earlier.
The central bank yesterday reported that the country's economic recovery maintained traction in December 2022, despite a slowdown in the global economy.
The service sector continued to be the main driver of growth thanks to a good upturn in foreign tourist arrivals, which also benefitted private consumption. In December last year, foreign tourist arrivals reached 2.24 million, up 872,300 year-on-year.
In December last year, the number of foreign tourist arrivals, after seasonal adjustment, increased from the previous month among several nationalities, especially those from Malaysia and Russia.
Positive effects of easing restrictions in international travel continued to persist and benefitted the service sector.
Meanwhile, the value of merchandise exports contracted 12.9% year-on-year in December 2022, following a slowdown in trading partners' demand, which in turn exerted downward pressure on manufacturing production and private investment, said Ms Chayawadee.
Major export categories which saw improvements were agricultural products, automotive, following an improvement in shortage of production materials, and electronics which increased slightly due to its delivery cycle.
However, the value of merchandise exports, excluding gold and after seasonal adjustment, slightly increased from the previous month.
Ms Chayawadee said the economy in the fourth quarter of 2022 continued to improve from the previous quarter on the back of increasing foreign tourist arrivals, which bolstered services and private consumption growth.
However, the value of merchandise exports deteriorated due to a slowdown in trading partners' demand and exerted downward pressure on manufacturing production and private investment as well.
