The deteriorating asset quality of the banking sector, rapid capital flow movements and tumbling commodity prices pose threats to the Thai economy, the former secretary-general of the United Nations Conference on Trade and Development Supachai Panitchpakdi warns.
"Several fear factors need to be monitored as they could lead to an economic collapse in some countries and spillover to the global financial market, including Thailand. These include slumps in commodity prices such as oil and consumer goods," he said.
Interest rate rises in certain major countries would also cause a wild swing in the Thai financial market and impact the stock market, he said.
Among the headwinds threatening the economy, the asset quality of the banking sector is the most important and it is essential to be prudent to prevent an upsurge in non-performing loans (NPLs) as in the past few years.
Don Nakornthab, senior director for financial institutions strategy at the Bank of Thailand, said last week that bad loans could rise further this year, but commercial banks have predicted NPLs will peak this year and could decline in later periods, assuming the economic recovery is on track.
Bad loans associated with small and medium-sized enterprises, consumer loans and the agricultural sector are projected to climb due to the tepid economic recovery.
Gross NPLs rose to 2.55% last year, with an outstanding value of 338 billion baht, up from 2.15% recorded in 2014, valued at 277 billion baht, according to the central bank's data.
Special-mention loans, classified as 30-90 days overdue, fell to 2.38%, valued 314 billion baht, from 2.61% in 2014, worth 336 billion baht.
Mr Supachai said the global economy would remain in partial recession for a while. Creating domestic demand and focusing on Cambodia, Laos, Myanmar and Vietnam are solutions for the Thai economy.
Cambodia, Laos, Myanmar and Vietnam are among the bright spots in light of their young populations and increasing number of middle-income earners.
These countries are playing a greater role in Thailand's export sector as seen by the fact that their proportion jumped to 11.3% of export value last year, from 3.9% in 2004.
Outbound shipments fell more than expected in 2015, declining by 5.78%, the biggest drop in six years. It fell for the third straight year, with export value totalling US$214 billion last year, the biggest decline since the US debt crisis sent exports tumbling 14.3% in 2009.
Cross-border retail trade is among the rising stars of Thai business this year, Mr Supachai said, adding that others are those are engaged in public investment, tourism, the digital economy and fourth-generation mobile service, logistics, and health and beauty.