Thailand's economy is expected to benefit from the government's consumption stimulus measures and a recovery in exports this quarter, says the Fiscal Policy Office (FPO).
Economic conditions are projected to continue improving in the final quarter from the third quarter, partly because of measures to rev up consumer spending such as the co-payment scheme, the We Travel Together campaign and the tax rebate for spending on goods and services, said FPO adviser Wuttipong Jittungsakul.
A gradual economic recovery is taking shape this quarter, but further assessment is needed on how certain sectors will contribute to the fourth-quarter economic recovery, said Mr Wuttipong.
Thailand's GDP contracted by 6.4% year-on-year in the third quarter following a 1.8% decline and a 12.1% contraction in the first and second quarters, respectively.
After a seasonal adjustment, the economy expanded by 6.5% quarter-on-quarter in the July-to-September period from the second quarter. In the first nine months, the economy contracted by 6.7%.
The improvement was attributed to the easing of lockdown measures and domestic travel restrictions, coupled with measures to rehabilitate the economy through fiscal stimulus.
Full-year GDP contraction is forecast at 7.7% this year, with growth of 4.5% projected for next year.
Economic conditions stabilised in October from the previous month, with some economic indicators seeing a trend of improvement.
Commercial car sales rose by 10.4% year-on-year last month, a second consecutive month of growth, and expanded by 2.8% from September on a seasonally adjusted basis.
Real farm income expanded by 12.6% year-on-year in October, up from 10.5% growth logged the previous month.
The manufacturing confidence index stood at 86, up for the sixth consecutive month, from September's 85.2.
Such increase was attributed to a pick-up in domestic demand for durable and non-durable goods, while stimulus measures created a pass-through effect on enhancing domestic economic activities.
Foreign visitors entering on a special tourist visa totalled 1,201 last month, with the majority coming from China, Cambodia and other Asean countries, said the FPO.
Some tourists originated from the Middle East and Europe.
Exports in US dollar terms, however, contracted by 6.7% year-on-year, down from September's 3.9% contraction due to lower exports in petroleum-related products and automobiles.
Revenue generated from value-added tax also contracted by 9.4% year-on-year compared with September's flat growth, attributed to lower oil imports, a decline in imports of some consumer goods and a high base effect in October 2019.