Finance Ministry keeps 2022 GDP outlook despite Omicron

Finance Ministry keeps 2022 GDP outlook despite Omicron

Tourists visit Maya bay in Krabi province on Jan 3, 2022. The Finance Ministry forecast the country to receive 7 million foreign visitors this year. (Reuters photo)
Tourists visit Maya bay in Krabi province on Jan 3, 2022. The Finance Ministry forecast the country to receive 7 million foreign visitors this year. (Reuters photo)

The Finance Ministry on Friday maintained its 2022 economic growth forecast at 4.0%, driven by a recovery in domestic spending and tourism, with Covid-19 outbreaks driven by the Omicron variant yet to have a significant impact.

The ministry still forecast the tourism-reliant country to receive 7 million foreign visitors this year, helped by the resumption of a quarantine waiver from next Tuesday, said Pornchai Theeravet, the Fiscal Policy Office director-general.

"Despite Omicron, there have been widespread vaccinations while Omicron symptoms are mild. So, we are confident that the 7 million figure is appropriate," he told a briefing.

So far, about two-thirds of the 72 million people living in the Southeast Asian country have been vaccinated.

The 7 million tourists would be far short of the nearly 40 million visitors during 2019, but a substantial improvement on the 428,000 foreign arrivals in 2021.

That 2021 figure was more than double the number forecast, however, prompting the ministry to raise its 2021 gross domestic product (GDP) estimate to 1.2% growth from 1.0% seen earlier, Pornchai said.

Foreign tourist spending generally accounts for 12% of Thailand's GDP.

Growth in the fourth quarter of 2021 is estimated at 0.9% to 1.3%. Official 2021 GDP data is due to be released on Feb 21.

After a 17.1% jump last year, exports, a key driver of growth, could rise just 3.6% this year, down from a previous forecast of 3.8%, due to slower global growth, Mr Pornchai said.

Fiscal policy will remain key in aiding the recovery with an existing borrowing plan, he said, noting improved consumption and confidence might reduce a need for further support.

"The ministry will monitor the situation closely and is ready to take appropriate measures to ensure continued economic recovery," Mr Pornchai said.

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