The Thai economy will not show significant recovery this year, slowed by the high level of household and personal debt, low farm prices and weak exports, the Thailand Development Research Institute (TDRI) predicted on Monday.
The economy is unlikely to show significant recovery this year due to high debt and low exports, according to the Thailand Development Research Institute. (Photo by Sayant Pornnantharat)
Somchai Jitsuchon, TDRI research director for inclusive development, said on Monday that internal factors were limiting economic growth.
Plummeting oil prices have had only light impact on local consumption in the face of high household and personal debt, and falling prices of agricultural produce have prevented farmers, a large part of the population, from repaying debt and buying products.
High household debt resulted from the tax rebate policy for first-time car buyers of the past government and the problem would need a few years to be cured, Mr Somchai said.
Besides, concerns about public debt were discouraging the government from fully stimulating the economy and the government could invest only in large-scale infrastructure projects, he said.
TDRI research director Somchai Jitsuchon
Even if such projects succeeded as planned, their positive effects on the national economy would be apparent only in the next few years, he said.
Thailand could also not depend on its exports because its products were outdated and unpopular in global markets, Mr Somchai said.
He did not see any investment in new technologies that would improve the competitiveness of Thai products.
The World Bank Group has predicted that the Thai economy would expand by 3.5% this year, compared with its slim growth rate of 0.5% last year.