Thailand’s economic growth is projected to slow to 1.8% this year and 1.7% next year, down from the World Bank’s earlier February forecasts of 2.9% and 2.7%, respectively. Last year, GDP grew by 2.5%, trailing regional peers.
In its latest Thailand Economic Monitor, the World Bank attributed the slowdown to weak exports, sluggish domestic demand, and a slower-than-expected recovery in tourism, especially due to fewer Chinese tourist arrivals.
Foreign tourist numbers are expected to reach 37.4 million this year, with full recovery to pre-pandemic levels not anticipated until Q2 2026.
Domestically, political uncertainty could delay the 2025 fiscal budget and public infrastructure investment, dragging down private investment and overall growth. On Tuesday, Thailand’s Constitutional Court suspended Prime Minister Paetongtarn Shinawatra pending a dismissal case.
“With rising uncertainty and easing inflation, monetary policy is likely to become more accommodative in 2025,” the World Bank added.
Finance Minister Pichai Chunhavajira warned that the economy may grow by just over 1% this year, citing the threat of U.S. tariffs. Washington has threatened to impose a 36% levy on Thai exports if no deal is reached before July 9, when a 90-day tariff cap expires.
