Siam Commercial Bank's Economic Intelligence Center (EIC) has again downgraded its 2019 economic outlook, slashing the forecast for Thai GDP growth to 3.6% amid a global economic slowdown and domestic political risk.
The EIC cut its view from 3.8% to reflect lower growth in the country's exports, said chief economist Yunyong Thaicharoen.
"Global economic growth is projected to decelerate more than previously expected and exhibit a synchronised slowdown pattern more clearly," he said. "This is due to the US-China trade war and tightening global financial conditions, especially in the second half of 2018, which continually have a negative effect on global trade and investment."
The research house in January trimmed its economic growth estimate to 3.8% from 4%. The latest forecast is below the central bank's outlook of 3.8% for this year.
The EIC also revised down its export growth forecast to 2.7% from the previous 3.4%.
Private investment is predicted to decelerate from the end of last year, consistent with a slowdown in the export sector, global trade policy uncertainty and post-election risk that could delay investment decisions, Mr Yunyong said.
Political uncertainty remains high even after the election, as both political factions hold close to equal numbers of parliament seats, he said, adding that there is a high chance that the new government could be a weak coalition government -- implying instability and low efficiency in implementing economic policy going forward.
"This might bring about delays in both investment and consumption decisions until the uncertainty subsides," Mr Yunyong said.
Vikrom Kromadit, chief executive of SET-listed industrial estate operator Amata Corporation Plc, warned yesterday at a seminar held by The Thai National Shippers' Council that Thailand should prepare for lower import demand and a reduced amount of tourists from China, which is expected to be hit hard by the ongoing trade war.
"The unabated trade row will definitely affect China's GDP growth," Mr Vikrom said. "This will eventually affect Thailand's tourism and fruit exports to China."
He suggested Thailand optimise its geographical strength to attract foreign direct investment and promote investment in the Greater Mekong Subregion.