The World Bank forecasts that the US budget deadlock could shave one percentage point off the gross domestic product (GDP) growth of East Asia and Pacific for every two percentage points the US economy falls.
Each decline of one percentage point in US GDP would then reduce regional economic growth by 0.5 percentage points, East Asia and Pacific chief economist Bert Hofman said yesterday after the bank's half-yearly review of the region's developing economies.
JPMorgan Chase recently estimated that each week of the government shutdown would reduce the annualised pace of US fourth-quarter economic growth by 0.12 percentage points. However, economists are more concerned about Congress failing to raise the debt ceiling on Oct 17.
The World Bank's growth forecast for regional developing countries including Thailand was lowered to 7.1% for 2013 and 7.2% for 2014 from 7.8% and 7.6% respectively.
The downward revision can mainly be attributed to the global economic slowdown, particularly in China. East Asia and Pacific is expanding at a slow pace as China is transforming from an export-reliant to a domestic-oriented economy.
Growth in middle-income countries, including Indonesia, Malaysia and Thailand, is also softening because of lower investment, global commodity prices and export growth.
The bank plans to revise Thailand's 2013 GDP growth forecast in December from the current projection of 4%, which was reduced from the forecast of 4.5% in April.
Monitoring the global economic situation is still warranted as it could have an effect on Thai exports.
The government's think tank, policymakers and the private sector had earlier trimmed economic projections following weaker-than-expected growth in the first half and lacklustre domestic consumption and private investment.
The National and Economic and Social Development Board cut its forecast of 2013 GDP growth to a range of 3.8% to 4.3% from a range of 4.2% to 5.2%.
The Fiscal Policy Office slashed its growth estimate to 3.7% from 4.5%, while CIMB Thai Bank and HSBC lowered their forecasts to the same level at 2.8%.
The World Bank predicts Thailand's export growth this year at 2.5%.
After three months of decline, exports rebounded in August because of a recovery in the global economy. For the first eight months of the year, Thai exports expanded by 1.03%.
"For the remaining four months of the year, Thai export growth should be 4-5% or around US$20-21 billion per month in order to meet our full-year projection of 2.5%," said Kirida Bhaopichitr, the World Bank's senior country economist.
The bank believes Thailand's economy could improve next year with GDP growth of 4.5%.
A rebound in exports in accordance with global economic recovery, and the government's infrastructure megaproject investment plan worth 2 trillion baht, will be the key engine forces driving economic expansion.
However, high leverage of household debt and the effects of the first-time car buyer scheme may dampen growth of household consumption next year.