A wave of sluggish economic growth across Asia has arrived on the shores of Thailand, with the south-east Asian nation reporting its weakest rate of quarterly expansion in almost five years amid a slowdown in tourism and rising trade tensions.
Data published by the National Economic and Social Development Board on Monday showed that the Thailand’s GDP grew by just 2.3 per cent in the second quarter, compared to a year ago. That is Thailand’s worst rate of quarterly expansion since 2014 and below the 2.4 per cent growth forecast by economists polled by Reuters.
Compared to the first quarter, the Thai economy grew by 0.6 per cent in the three months to June, also below expectations.
Thailand’s economy has been hurt by a slowdown in its important tourism industry, which has been impacted by stuttering growth in China, a key source of tourists, and strength in the Thai baht.
“With weak global demand and a downturn in the tourism sector likely to drag on growth prospects over the coming quarters, we expect the economy to remain weak,” said Gareth Leather, senior Asia economist at Capital Economics.
“The important tourism sector is struggling due in large part to a slowdown in arrivals from China. If economic growth in China continues to slow as we expect, then tourism arrivals to Thailand are likely to remain weak,” Mr Leather added.
Capital Economics forecasts that full-year growth will come in at 2.5 per cent in 2019, down from 4.1 per cent in 2018.
A number of trade-based economies across the region have seen growth stumble this year, due to factors including a slowdown in the global economy, US-China trade tensions, Both Singapore and Hong Kong in the second quarter reported their worst quarterly GDP figures in more than a decade, with economists predicting that both will fall into recession later in 2019.