Thailand’s economy probably shrank again in the first quarter of this year, a Reuters poll showed on Friday, as coronavirus outbreaks hurt consumption and tourism, slowing the pace of the economic recovery.
Southeast Asia’s second-largest economy, which is heavily reliant on tourism, is believed to have contracted 3.3% in the first quarter from a year earlier, according to the median estimate of 11 economists in the poll. It slumped 4.2% in the final quarter of 2020.
On a quarterly basis, gross domestic product (GDP) likely shrank a seasonally adjusted 0.8% in the March quarter after posting growth of 1.3% in the fourth quarter of last year.
The National Economic and Social Development Council will announce the official figures on Monday. In February it forecast 2021 GDP growth of between 2.5% and 3.5%, but it is expected to announce revised projections on Monday.
The latest coronavirus outbreak, which started in April and has accounted for more than two thirds of the country’s total infections, has slowed domestic activity at a time the country was preparing to reopen more broadly to foreign visitors.
Economists in the poll predicted full-year growth of 2.1% in 2021, after a 6.1% contraction in 2020. Analysts have slashed their forecasts in recent months from around 3% at the start of the year due to the outbreaks and a slow vaccine rollout.
The economy could shrink again in the second quarter from the previous quarter as most indicators remain weak, said Takit Chartchredsak, economist of Asia Plus Securities.
Increased exports, a key growth driver, and recent stimulus measures have lent some support, however.
The cabinet approved an additional economic relief package worth 255 billion baht earlier this month to help people affected by the latest outbreak.
“A fresh fiscal thrust and export pick-up will help offset part of the impact, but the pace of turnaround this year will be slower than previously assumed,” said DBS economist Radhika Rao.