Thailand’s GDP grew 1.5% in Q1: NESDC

The Thai economy expanded by 1.5 percent year-on-year in the first quarter, according to the National Economic and Social Development Council (NESDC).

Danucha Pichayanan, NESDC secretary-general, told the press on Monday that the economy grew 1.1 percent in the January-March quarter compared to the previous quarter thanks to a 6.9 percent expansion in private consumption and the service sector. Exports in the first quarter also rose by 2.5 percent, while private investment grew by 4.6 percent.

Yet, despite the growth, NESDC has lowered its projection for this year to 2-3 percent from 2.2-3.2 percent mainly due to the risks posed by the ongoing US-China trade war and geopolitical conflicts.

Danucha said the economy is also under pressure by the slowdown in state projects, which contracted by 27.27 percent owing to the slow disbursement of state funds.

He noted that though private consumption had risen by 6.9 percent, it was still lower than the 7.4 percent growth in the fourth quarter of last year. He attributed this to a higher rate of unemployment.

Risks to economy

The gross fixed capital formation for the first quarter also dropped 4.2 percent YoY, compared to a drop of 0.4 percent in the last quarter of last year, he said.

READ: Thailand lowers 2024 GDP growth projection to 2.8%

Danucha reckons the biggest risks facing the economy this year are a surge in household debts and flooding.

Rising freight costs due to risks from geopolitical conflicts would also affect exports which in turn would affect the economy.

Danucha said the NESDC had predicted that overall investment this year would expand by 1.9 percent and is advising the government to accelerate the disbursement of funds to reach its economic targets.

It has also advised the government to ensure SMEs have enough liquidity and to work on solving the problem of household debts.
The NESDC has also advised the government to take care of farmers who could be affected by floods during the upcoming rainy season.

The government is encouraged to closely monitor global economic fluctuations and implement measures to boost exports and industrial production.