Thai Economy Will Bounce Back In 2020, Not This Year
Thailand's economy has been forecasted to stay stagnant this year, stamping on hopes that Gen Prayut Chan-o-cha's return as the Prime Minister will help boost the economy as a whole.
According to the Bangkok Post, supposed key drivers in the Thai economy have been signaling weak expansion and developments. While Prayuth's reelection helped drive some sectors for a short period, long-term effects have yet to be felt by the economy.
Analysts believe the Thai economy will not yet recover as previously expected in 2019. Instead, growth will most likely be felt the following year, if exports increase by the second half of this year.
Due to slow progress in projects funded through public investments as well as confidence in Prayuth and his ability to overturn the downtrend, the World Bank decided to slash its forecast from 3.8 percent earlier this year to 3.5 percent.
The bearish forecast was based on weaker developments in multiple sectors such as agriculture, automotive, and tourism segments. It is further expected that farmers will feel the brunt of slower economic growth in the country.
"The slowing global economy will accordingly lower prices for agricultural products in the second half," Director of the Center for International Trade and Studies at the University of the Thai Chamber of Commerce, Aat Pisanwanich, noted.
To help curb the effects for slower growth in the agriculture sector, Aat believes Thailand's government should encourage farmers to export fruit products. For this particular project, Aat recommends the use of social media platforms for advertising and marketing.
Experts have also urged the Thai auto sector to explore other possibilities in exporting vehicles to other countries. Competition is getting tougher and even a country like Thailand that is known worldwide for auto exports could crumble due to weaker global demand.
Despite the multiple issues that Thailand is faced with this year, things are expected to lighten up by early 2020 as foreign direct investments (FDI) flow in. Furthermore, growth in China and the U.S. are expected to improve next year, pulling the economies of Southeast Asian countries doing business with the world's largest economic leaders.
Over the weekend, some analysts predicted that Prayuth will have to focus his second term around reconciling politics in the country. Thailand has long been embroiled in political problems and eyes are on Prayuth as he tries to narrow the gap between opposition and present leaders.
Economic experts also pointed out that Prayuth should lead Thailand towards improved engagement and trade with member nations of the ASEAN region. This move is expected to help enhance exporting sectors and strengthen the country's position in Southeast Asia.