The direction of external factors in 2025, such as geopolitical conflicts, will be difficult to ascertain. The economies of various countries, including Thailand's key trading partners, will continue to be closely monitored due to political shifts, particularly the United States with the return of Donald Trump as the nation's 47th president.
Business leaders and CEOs share their perspectives on the economy and their industries, highlighting the challenges they expect to face in the coming year.
SCB sees more uncertainty
The economy and banking sector are expected to face heightened uncertainties in 2025, driven by both external and internal challenges, according to Kris Chantanotoke, chief executive of Siam Commercial Bank (SCB).
Mr Kris highlighted Thailand's high household debt as a critical structural issue hindering economic growth and the banking sector's expansion.
SCB Economic Intelligence Center (EIC), the bank's research centre, projects GDP growth to slow to 2.4% in 2025, down from 2.7% that it forecasted for 2024. The deceleration is attributed to both external and internal factors.
Externally, US economic policies under President-elect Donald Trump's second term, referred to as Trump 2.0, are expected to emphasise trade protectionism, exacerbate geopolitical tensions and prioritise energy security over climate initiatives.
Internally, Mr Kris highlighted Thailand's high household debt as a critical structural issue hindering economic growth and the banking sector's expansion.
This challenge is expected to constrain loan growth across the banking industry, as institutions adopt selective lending practices to maintain asset quality.
SCB, the country's fourth-largest lender by total assets, aims to achieve marginal loan growth in 2025 through a selective strategy.
Due to high household debt levels, the bank will primarily target the upper-income segment, focusing on individuals with monthly incomes exceeding 50,000 baht. Its growth strategy will emphasise secured loans, including mortgages and auto loans.
"The banking sector is expected to face significant challenges in 2025, putting greater pressure on earnings compared to other industries," he said. "High funding costs and declining fee-based income are likely to impact profitability, making effective cost control essential."
EIC forecasts that the banking sector will implement its tightest loan growth practices in a decade in 2025, primarily due to rising credit risks, particularly from vulnerable households amid weaker economic growth.
Total loan growth across the industry is expected to remain flat or show marginal growth, not exceeding 1%.
"Banks began tightening loan growth in 2024, and this cautious approach is expected to persist in 2025 due to concerns over asset quality," according to EIC.
"In 2025, the banking sector is anticipated to implement its most stringent loan expansion practices in a decade," the EIC noted.
Additionally, Mr Kris stated that digital banking will play a crucial role in controlling operating costs, enhancing business efficiency, and supporting income growth.
SCB has developed AI-powered banking solutions to meet customer needs in the digital era, aiming to strengthen long-term profitability.
At the same time, maintaining quality service through human interaction remains crucial. Therefore, SCB's "Digital Bank with a Human Touch" strategy aims to balance technological innovation with personalised customer care, he added.
According to Mr Kris, SCB is modernising its core banking system to provide enhanced financial services to customers as part of the Digital Bank with a Human Touch strategy, which also integrates artificial intelligence (AI) technology.
The bank plans to launch the pilot project for its core banking restructuring at the beginning of 2025. The revamp includes both operational processes and the transition to digital banking services.
"The core banking restructuring will enhance efficiency and reduce operating costs. SCB lowered its cost-to-income ratio from 41% in recent years to 36.7% now," said Mr Kris.
"Over the long term, the bank plans to reduce the ratio to 30%, a level on par with successful virtual banks."
Thai AirAsia chief upbeat on outlook
Thailand's aviation sector in 2025 is expected to improve compared to the previous year, buoyed by more stable global factors such as fuel prices, but a key challenge remains the country's ability to cope with ongoing economic downturns, says Tassapon Bijleveld, executive chairman of Thai AirAsia.
Mr Tassapon said the Indian market would emerge as the key market for Thailand in 2025 due to its large population and a more convenient level of connectivity between the two countries.
Mr Tassapon said the return of Donald Trump as US president wouldn't have a devastating effect on the aviation industry, particularly if he can end the conflict between Russia and Ukraine as promised.
He said the end of the war would help maintain fuel prices, which is one of the largest operating costs for airlines. Stable oil prices would also bring greater stability to the currency market, which is also crucial for airlines.
Peace on the European continent would also help improve tourism sentiment among Europeans to some extent as many countries are facing an economic downturn, notably Germany.
"For the global situation, the aviation industry almost has nothing to be concerned about in 2025. Trump himself was a businessman. His tariff threats against other nations might not be fully implemented if those measures do not provide significant benefits to the US in the end," he said.
The most critical factor to watch in 2025 would be Thailand's competitiveness, mainly regarding the government's efforts to improve the sluggish economic growth recorded over the past few years, said Mr Tassapon.
He said the government should not cling to using measures with huge budgets to stimulate consumption, but should consider launching stimulus schemes of various scales, whether small or medium, to maintain consistency in domestic consumption.
For the aviation sector in 2025, Mr Tassapon said the Chinese market would continue to stay flat as was the case in 2024, with a slim chance of growth.
However, the Indian market would emerge as the key market due to its large population and more convenient connectivity between the two countries, he noted.
He said Thai AirAsia and Thai AirAsia X together fly directly to 13 cities in India, which is more than China, where they connect to 12 cities.
The latest route launched by Thai AirAsia X connects Bangkok with New Delhi, using Airbus A330s to cater to robust Indian tourism demand.
While the aircraft shortage has been an issue for airlines globally, Mr Tassapon said its two carriers in Thailand have still been able to allocate new aircraft to the fleet, adding six to Thai AirAsia's fleet and two to Thai AirAsia X's fleet.
Digital industry drives energy demand
Chaiwat Kovavisarach, president of Bangchak, sees growth in power-hungry data centres
Yuthana Praiwan
Thailand will see a significant increase in power demand as the government continues to push the growth of data centres and the cloud service industry, said Chaiwat Kovavisarach, group chief executive and president of energy conglomerate Bangchak Corporation Plc.
Mr Chaiwat stressed the need to better manage power supply as the data centre industry is growing in Thailand. (Photo: Somchai Poomlard)
The Board of Investment is supporting investment projects in data centres and cloud services, paving the way for Thailand to become a regional digital innovation hub.
According to a report released by the board in November 2024, officials received applications for investment incentives for 47 projects, worth 173 billion baht, in data centres and cloud services from Thai companies and companies from the US, China, Australia, Hong Kong, Singapore, Japan and India.
Two data centre operators -- Quartz Computing Co, a subsidiary of Alphabet Inc, the parent company of Google, and Digitalland Services (Thailand), a subsidiary of China-based GDS Holdings Ltd -- as well as US-based cloud service provider Equinix already announced their investment plans in Thailand.
Data centres are crucial infrastructure for artificial intelligence (AI) technology. If AI-based tasks continue to grow in Thailand, a huge amount of electricity will be needed to keep the facilities running, said Mr Chaiwat.
One AI-embedded data centre requires between 300 and 1,000 megawatts of electricity, he said.
"Take Ireland as an example. The country has around 18 data centres, consuming 20-25% of total power supply," said Mr Chaiwat.
If Thailand needs electricity which causes a lower carbon footprint and ensures stable supply and the country also wants to depend less on fossil fuels, nuclear power development may be an inevitable choice for policymakers, he added.
Telecom giants struggle to grow revenue as costs soar
The telecom business sector has continued to struggle to sustain growth of its revenue stream.
Mr Somchai says AIS has explored all business opportunities for providing services in the competitive market.
Despite the industry's revenue target growth for 2025 of around 4-5%, its operational costs, including electricity expenses, network expansion investment, spectrum licences and related fees are expected to grow by 10% from 2024.
According to Somchai Lertsutiwong, chief executive of Advanced Info Service (AIS), the telecom business's revenue stream normally grows by 2% above Thailand's annual GDP growth rate.
The country is projected to post GDP growth of 2-3% in 2025.
He said the rise in total expenses has created pressure on telecom operators' annual earnings before interest, taxes, depreciation and amortisation.
The telecom operators continue to invest every year in network capacity expansion to cater to huge rises in internet bandwidth consumption.
The investment is also to provide more innovative services and maintain service quality.
Although True Corporation and Total Access Communication were merged into True Corporation in early 2023, the market competition still remains strong, he added.
Due to the current factors, all telecom firms have to struggle to boost their monthly average revenue per user (ARPU), Mr Somchai said.
For fixed internet broadband business, Mr Somchai said pricing and promotional packages would no longer be enough to sustain business in the long term, but the operators have to create value-added services by bundling their services with a variety of smart devices and entertainment content that serve the demands of consumers in their daily lives.
When it comes to mobile phone services, the operators have to boost 5G adoption among users to increase the ARPU.
Mr Somchai hopes to see the National Broadcasting and Telecommunications Commission (NBTC) offering a subsidy to people who currently use 3G mobile phones to switch to 5G mobile phones to access a greater number of smart services and innovation.
There are currently around 12 million people who still use 3G mobile phones.
Exploring the upcoming auction
NBTC is set to auction licences of three spectrum bands in the first quarter of 2025.
These three bands -- 850MHz, 2100MHz and 2300MHz -- are now being used by state telecom enterprise National Telecom under a partnership with its private telecom partners.
The bands will expire in September 2025. They will be sold through the multiband auction method.
However, the regulator is concerned about whether the planned auction will be successful as only two major operators, AIS and True, are now left in the market, according to NBTC commissisoner Sompop Purivigraipong.
NBTC is hoping that both will consider participating in the auction as consumer demand for bandwidth has been soaring each month.
Mr Sompop said NBTC will make sure that the upcoming auction will not involve huge costs for prospective bidders, or they might opt to pass any high burden on to the consumers.
NBTC is prepared to add other spectrum bands, which are now vacant or in the process of being reallocated, into the planned multiband auction. The other spectrum bands include 3500MHz.
Mr Somchai said that although the operators' existing bandwidth is sufficient for normal operations over the next one to two years, AIS is eager to ensure its spectrum portfolio is sufficient for the long term to better serve customers and for the upcoming development of 6G.
He added that AIS has explored all business opportunities for providing services in the competitive market.
Thailand to gain from US-China trade war
The expansion and relocation of foreign production facilities to Thailand will be an investment trend in 2025, following the impact of the new US trade policy under President-elect Donald Trump's administration, said Vikrom Kromadit, chairman and acting chief executive of Amata Corporation, an industrial estate developer.
Mr Vikrom expects more foreign investment in Thailand, driven by the impact of America's new trade policy.
He expects to see more investment in high-tech industries, including data centres and cloud services, smart electronics and electric vehicles (EVs).
Many entrepreneurs who want to avoid the impact of the US-China trade war and Washington's trade barriers will choose Thailand as an investment destination, he noted.
Trump, who will take office on Jan 20, has said he will impose tariffs of 10-20% on all imported products, with tariffs of 60-100% on goods imported from China, according to media reports.
"Thailand can draw foreign investors because of its good infrastructure and a supply of clean power that meets the needs of many businesses," said Mr Vikrom.
Thailand is among the first countries in Asean to supply renewable power to investors. The government has promoted the greater use of solar and wind power as well as importing electricity from hydropower plants in Laos.
Authorities have also fuelled investment in EVs by granting incentive packages to automakers who build EV assembly facilities in the country. Many Chinese EV manufacturers say they plan to use local auto parts to support their manufacturing.
Up to 600 car and auto parts factories are located in Amata-run industrial estates in Thailand.
Investment from foreign companies in Amata's industrial estates in Chon Buri and Rayong accounts for 20% of total foreign direct investment (FDI) in the country, said Mr Vikrom.
From January to September 2024, the value of the nation's FDI increased by 38% year-on-year to more than 546 billion baht, according to the Board of Investment.
Jewellery sector to retain its lustre
Suriyon Sriorathaikul, the managing director of Beauty Gems, predicts that Thailand will continue to be a leading player this year in the jewellery and gemstone sector, which currently ranks as the country's third-largest export industry.
Mr Suriyon described the the jewellery and gemstone sector as being a creative industry that thrives on product design and craftsmanship.
Key export markets include Hong Kong, Europe, the US and the United Arab Emirates.
Mr Suriyon points out that the industry may encounter significant challenges this year, such as heightened trade competition and protectionist measures.
Tariff increases that are introduced during the Trump 2.0 administration, which plans to raise tariffs on all imported goods, could pose considerable obstacles for the industry.
Additionally, ongoing geopolitical tensions, such as the Russia-Ukraine war and the Israel-Hamas conflict, along with Europe's economic downturn, have created a tougher global trading landscape for jewellery and gemstones.
"Thai jewellery producers need to navigate fluctuating raw material prices -- like gold, silver and other precious metals -- and maintain consumer confidence in light of these global challenges," he said.
Mr Suriyon expressed concern that the US tariff hikes could impact Thailand's jewellery exports, especially since the US ranks as one of the largest markets for this sector, and Thailand has benefited from a trade surplus with the US.
To bolster the industry, he emphasised the need for efficient import duties on raw materials and streamlined customs procedures for both imports and exports. Simplifying regulations and removing bureaucratic hurdles will be crucial for maintaining competitiveness.
"The government should acknowledge the jewellery and gemstone industry as a vital revenue-generating sector and provide comprehensive, coordinated support. This should cover raw material imports, production processes, promoting the industry, revising the tax system and backing exports," he said.
Mr Suriyon described the jewellery and gemstone sector as a creative industry that thrives on product design and craftsmanship.
Unique creations, such as brooches shaped like elephants and insects, significantly enhance product value. These artistic designs not only reflect Thailand's cultural heritage but also elevate the industry's potential as a key player in the country's soft power strategy -- a priority for the government.
In terms of the company's development, Mr Suriyon revealed that Beauty Gems will proceed with caution in light of global and domestic economic uncertainties.
With 60 years in the industry, the company remains dedicated to upholding quality standards across all products while also keeping an eye on new trends and developing offerings that appeal to new generations and emerging markets.
AI skill shortages to plague IT sector
Geopolitical conflicts, a shortage of talent with the necessary artificial intelligence (AI) skills, and an uncertain economic outlook are among the challenges facing the technology sector in 2025, according to Somchai Sittichaisrichart, managing director of the SET-listed IT product distributor SIS Distribution (Thailand).
Mr Somchai says despite the challenges facing the economy, AI-enabled PCs will drive user demand.
He said that information technology in Thailand, including the smartphone market, is worth around 200 billion baht per year.
Despite the challenging economy, AI-enabled PCs will drive user demand for PCs, but more AI applications are still required to trigger greater usage of AI-based PCs, he noted.
When examining the overall IT market, projections suggest consumers will decelerate their tech purchases, while businesses are expected to invest in AI in order to increase competitiveness.
He said the rise of AI adoption in the business sector and the availability of hyperscale data centres have driven demand for personnel with AI skills, resulting in a shortage of suitably qualified people, ranging from engineers to sales people.
Technology vendors have continued to produce related online courseware to equip new graduates with advanced skills, he said.
Earlier, the Ministry of Higher Education, Science, Research and Innovation (MHESI) introduced its "MHESI for AI" policy.
As part of the policy, it aims to produce at least 30,000 AI professionals, AI engineers, and workers in IT or other vocations with basic AI skills within three years.
Mr Somchai said geopolitical conflict is another concern as President-elect Donald Trump might accelerate the tech war with stricter rules preventing tech distributors from selling US technology to Chinese customers.
This indicates that not only IT product distributors, but also IT service providers should be well prepared to manage the risks stemming from the US-China tech war, he added.
He said the Thai government can help stimulate two key markets -- the market for solar power systems and the adoption of AI technology.
This could be achieved by offering a tax incentive to corporations that procure solar panels for their adoption of green energy or for their use of technology to promote digital transformation. They should be given a tax deduction of double their IT expenses.
Moreover, the government should lower the cost of electricity to attract greater investment into hyperscale data centres.
Hyperscale data centres have two main costs -- the cost of electricity and the cost of controlling the temperature.
The temperature in Thailand is high, so the government should offer electricity to data centre operators at a more competitive price when compared with neighbouring countries, said Mr Somchai.
If data centres can enjoy lower costs, they will then be able to provide cloud services at a lower price, he noted.
Bangkok Cable relishing opportunities
Thailand is stepping into 2025 with a cautiously optimistic economic outlook. While global economic challenges persist, the nation's infrastructure sector remains poised for significant growth with continued investments -- especially in the Eastern Economic Corridor -- across digital infrastructure, transportation and smart cities.
Mr Pongsapak aims to cement the firm's position as the backbone of Thailand's infrastructure.
As the chief commercial officer of Bangkok Cable, Thailand's leading manufacturer of electric wires and cables, Pongsapak Nakornsri views these shifts as opportunities for innovation, aiming to deliver the best-in-class digital power solutions across the electric value chain to help accelerate the decarbonisation of all sectors and drive Thailand closer towards its net-zero commitment.
Mr Pongsapak, the third-generation of a family enterprise built over six decades by his grandfather, founder and chairman Sompong Nakornsri, aims to cement the company's position as the backbone of Thailand's infrastructure -- an engine that powers the nation forward in a world increasingly defined by the challenges of climate change and electrification.
Today, as electric cables become ever more critical in the decarbonisation of the grid and unlocking a green electric future, Mr Pongsapak is steering Bangkok Cable into a new era of regional expansion.
Thailand's energy sector is shaped by the ongoing energy transition and renewable energy expansion, particularly for solar and wind power as well as the continued growth of electric vehicles supported by government incentives and infrastructure development.
Large-scale regional initiatives such as the Asean Power Grid further highlight Southeast Asia's collective commitment to energy security and sustainable development, paving the way for a more resilient and integrated energy network -- an endeavour that positions Thailand to leverage its strengths and help steer Southeast Asia towards a more resilient, electrified future.
Mr Pongsapak said Bangkok Cable is also shifting focus to regional expansion, targeting Asean dominance as a key driver of sales growth leading into 2025.
Fetco chairman sees growth exceeding 3% this year
Kobsak Pootrakool, chairman of the Federation of Thai Capital Market Organizations (Fetco), predicts that Thailand's economic growth rate will exceed 3% in 2025, driven by export and tourism growth.
Mr Kobsak said the profits of SET-listed firms are projected to surge, strengthening the valuation of the Thai stock market in 2025.
The recovery of the global economy will help Thailand's exports to continue to expand. Shipments reached US$27.2 billion in October, a 14.6% increase from the corresponding period of 2023, representing the highest export value in 19 months.
Authorities forecast that roughly 4 million foreign tourists will travel to Thailand in December alone, bringing the total number of international arrivals to 36 million this year, showing that the tourism sector has fully recovered, he said.
Foreign direct investment (FDI), particularly in the electric vehicle (EV) and data centre sectors, has been surging. The US Federal Reserve (Fed) has started cutting interest rates and other central banks have begun easing their monetary policies.
"The interest rate cut is good news for the capital market and the economy as a whole. That's why Fetco believes the Thai economy will grow by more than 3% in 2025 and continue to expand well over the following years," said Mr Kobsak.
Among the risk factors that remain a concern for investors is the Chinese economy, which has been plagued by a real estate crisis and bad debts.
"China's economic growth has been slow. If that continues, global growth might be affected," he said.
Another concern is Donald Trump's return to the White House on Jan 20. The former president has clearly stated his plan to raise import tariffs on goods shipped from several countries, especially China.
"Thailand might be negatively affected by the US tariff increases but it also provides an opportunity for Thailand to grab the opportunity in terms of manufacturers relocating their operations from China."
Lastly, risks from international conflicts remain, such as the Russia-Ukraine war, conflict in the Middle East as well as other areas, he noted.
As for the direction of the Thai stock market, the Securities Analysts Association (Thailand) expected the Stock Exchange of Thailand index to finish at 1,494 points in 2024. The index is projected to rise to 1,614 points this year, supported by a recovery in the global and domestic economies.
Profits of listed firms are also projected to surge, strengthening the valuation of the Thai stock market in 2025, Mr Kobsak said.
Mall Group braces for uncertainties in 2025
The Thai economy will face ongoing uncertainties in 2025, according to The Mall Group Co Ltd.
Post-pandemic, the global economy has been on recovery path. However, it has encountered setbacks due to political instability around the world, which has led to a slowdown, said Achara Umpujh, senior executive vice-president of The Mall Group.
Ms Achara anticipates the Thai economy facing ongoing uncertainties in 2025.
She anticipates a high level of economic uncertainty in 2025.
To counter these challenges, the government has proposed various stimulus measures, including investments in infrastructure such as airport expansion as the country aims to become a regional hub for air transportation.
Ms Achara encouraged the government to expedite the implementation of these plans.
"The private sector would like to see the government ramp up the existing plans," she said.
As the Thai economy heavily relies on tourism, a key market is Chinese travellers.
Ms Achara pointed out that a decline in Chinese tourists could pose a challenge for operators in the retail sector.
She said that the retail market is becoming more segmented with a greater focus on personalisation this year. Operators need to adapt to rapidly changing trends such as pet-friendly malls, an ageing society and the green economy.
"Department stores must evolve beyond just being places for products and services, they should also offer a lifestyle experience, catering to customer needs. They should be venues where people can socialise with friends and more," she said.
Noble upbeat on property outlook
The property market in 2025 is expected to improve from the previous year, driven by a gradual economic recovery and robust demand from foreign buyers, though geopolitical factors may play a role, says Thongchai Busrapan, co-chief executive of SET-listed Noble Development.
Mr Thongchai says foreign demand for Thai properties should double in 2025.
He said the return of president-elect Donald Trump is a significant factor impacting global geopolitics and investment trends.
"Driven by geopolitics, foreign demand for Thai properties should double in 2025. The growth will derive from existing geopolitical conflicts and the change in US policies," he said.
Taiwanese clients purchased more Bangkok condos in 2024, driven by geopolitical uncertainties, said Mr Thongchai.
The outlook for Ukraine, where support is limited, has made Taiwanese more cautious, he said.
The return of Trump to the White House adds to the sense of insecurity, prompting more investors to leave China, said Mr Thongchai.
Many are expected to shift their focus to Southeast Asia, with Thailand potentially benefiting due to its strong connectivity with China and the introduction of a visa-free policy for Chinese tourists.
Demand from buyers from Myanmar is expected to continue because of internal political issues.
Although the Myanmar government has restricted the outflow of money, many potential buyers already have funds in Thailand, which has accelerated their decision-making, he said.
"Regarding factors in Thailand, we've had some setbacks due to politics, but things should improve now as everyone has managed to reach a consensus to some extent," said Mr Thongchai.
He said positive factors for economic recovery include growing tourism, recovering consumer confidence, a downward trend in interest rates, government property measures and debt relief policies.
"Interest rates are dampening demand. Personal credit issues are preventing buyers from making purchases," said Mr Thongchai.
"Relaxing loan-to-value limits now may be too late as other factors are preventing people from securing loans," he added.