FPO maintains Thai GDP growth forecast

The Fiscal Policy Office (FPO) has maintained its Thai economic growth forecast this year at 3.8%, in line with the continued rebound of the tourism sector and declining inflation.

FPO director-general Pornchai Thiraveja said on Friday the figure is unchanged from the October projection.

He said the figure suggests the Thai economy is trending upwards after being hit by the impact of the pandemic during 2020-2021.

The Thai economy is expected to expand by 3% in 2022, up from 1.5% in 2021, according to the FPO.

Mr Pornchai said risk factors that require monitoring include the possibility of a global recession and volatile global financial markets, coupled with geopolitical conflicts and China's economic struggle amid Covid-19 outbreaks.

The FPO expects international tourist arrivals to tally 27.5 million this year, which are forecast to generate revenue of 1.2 trillion baht.

Export growth is expected to slow down this year in line with weak demand from major trading partners, he said.

According to the FPO, the economies of Thailand's 15 key trading partners are expected to expand by 3.3% on average this year, down from anticipated growth of 5.4% last year.

Thai shipments are projected to post growth of 5.3% last year, compared with 19.2% growth in 2021.

The FPO expects private domestic consumption to expand by 3.5% this year, down from projected growth of 6.9% in 2022.

Private investment is expected to expand by 3.6% this year, compared with projected growth of 4.2% in 2022.

The agency predicts headline inflation of 2.8% this year because of declining global energy prices.

The FPO projects an average Dubai crude oil price of US$85 per barrel this year, down from $95.4 last year, as the global economy slows.

Thailand is expected to post a current account surplus of $3.1 billion this year, representing 0.5% of anticipated GDP, compared with a forecast deficit of $19.8 billion in 2022, according to the FPO.