The Thai economy is still on the recovery path and should grow 3.4% in 2022 and 3.8% next year, supported by a rebound in the vital tourism sector, Finance Minister Arkhom Termpittayapaisith said on Wednesday.
Southeast Asia's second-largest economy can weather global uncertainties, while average inflation should come in at 6% this year, Mr Arkhom said at a World Bank event.
- World Bank sees higher 2022 growth, cuts 2023 outlook -
The World Bank said on Wednesday that Thailand's economy is expected to recover to its pre-pandemic level this year, but the pace of growth will be slower-than-expected next year due to global obstacles, the World Bank said on Wednesday.
The bank expects the country to grow 3.4% in 2022 and 3.6% in 2023, compared with September forecasts of 3.1% and 4.1%, respectively.
The reduced 2023 growth outlook reflected a faster-than-expected decline in global demand, while a tourism sector recovery and private consumption would remain the major drivers of growth, the bank said in a statement.
Thailand received 10 million foreign tourist arrivals as of last week in 2022 and the government is expecting the number to double next year. The country saw only 428,000 foreign tourists last year, compared with nearly 40 million before the coronavirus pandemic in 2019.
The country's exports of goods, however, are expected to contract 2.1% in 2023, after an estimated rise of 8.1% in 2022, reflecting weakening demand from major trading partners, the World Bank said.
While the Thai economy has shown resilience to recent global shocks, the poverty rate is projected to rise to 6.6% in 2022 from 6.3% in 2021 as Covid-19 relief measures start to be phased out amid elevated inflation, the bank said.
"As Thailand looks towards resuming its path towards high-income country status post-pandemic, raising adequate fiscal space will be necessary to meet the additional spending need and provide a fiscal buffer for future shocks," said Fabrizio Zarcone, World Bank Country Manager for Thailand.