GDP up 1.8% in Q4 of 2021, stronger than expected

GDP up 1.8% in Q4 of 2021, stronger than expected

A traditional massage shop in the Pratunam area of Bangkok has decided to switch to selling vegetables after the closure of the parlour due to the Covid-19 pandemic. (Photo: Arnun Chonmahatrakool)
A traditional massage shop in the Pratunam area of Bangkok has decided to switch to selling vegetables after the closure of the parlour due to the Covid-19 pandemic. (Photo: Arnun Chonmahatrakool)

Thailand's economy returned to growth in the final quarter of 2021, official data showed on Monday, as exports increased and domestic activity improved following an easing of coronavirus curbs and reopening to tourists.

Southeast Asia's second-largest economy expanded a seasonally adjusted 1.8% in the December quarter from the previous three months, data from the National Economic and Social Development Council (NESDC) showed, outstripping a forecast 1.4% increase in a Reuters poll, and after a revised seasonally adjusted 0.9% contraction in the third quarter.

From a year earlier, gross domestic product (GDP) grew 1.9% in October-December, beating a forecast 0.7% rise, and against a revised 0.2% contraction in the previous three months.

The economy grew 1.6% in 2021, rebounding from a revised 6.2% contraction in 2020. Economists had forecast 1.2% growth last year, the NESDC said.

For 2022, the agency maintained its GDP outlook at 3.5% to 4.5%.

As part of its "living with Covid" strategy, the Prayut Chan-o-cha government has gradually relaxed restrictions to boost the economy, which had the slowest growth in Southeast Asia last year.

Rising price pressures -- which last month exceeded the central bank’s inflation target for the first time since April 2021 -- and the Omicron wave have raised concerns about the recovery this year.

The consumer price index rose 3.23% in January, above the Bank of Thailand's 1%-3% target. The central bank, which earlier this month held its benchmark interest rate at a record low for a 14th straight meeting, said average headline inflation this year is likely to exceed its 1.7% forecast. 

A tourism revival may help jumpstart the economy after the government reopened the country’s borders last November. Thailand welcomed 230,497 tourists in December, the highest monthly figure since March 2020, at the start of the pandemic. Still, the total of 427,869 foreign visitors in 2021 was a fraction of the 40 million in 2019, when the tourism industry generated revenue of more than US$60 billion.



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