Country Economic Forecasts > Thailand

Limited by subdued external demand and modest private spending and investment trends, Thai economic activity remains generally sluggish, with growth focused on only a few sectors. Exports of goods in US$ terms contracted by a larger amount in July than in Q2, while manufacturing output recorded a large fall and private investment showed no growth, continuing its moderate overall trend since 2013. At the same time, the boosts to Thailand's GDP from strong tourism and public spending, although still substantial, may now be starting to fade. Looking forward, it seems very unlikely that the economy will be able to escape a prolonged period of patchy, modest growth of around 3%, held back by low levels of confidence in the country's political and economic outlook and a dull external backdrop.Furthermore, concerns about the health of the king have risen in recent weeks. The palace released a statement at the beginning of the month that he had received treatment for a severe blood infection. His condition has since improved but, as he is 88 and has experienced many bouts of illness in recent years, worries remain high about the state of his health. His death could plunge Thailand into political and economic turmoil if the royal succession was to get caught up in the country's deep political divide.