The Thai economy is anticipated to gather momentum in 2025, propelled by increased domestic demand and fiscal stimulus initiatives. Economic growth is expected to rise to 2.9% in 2025 from 2.6% in the previous year. Key contributors to this growth include tourism and private consumption, though their impact will be less pronounced than before.
Tourism is on track to reach pre-pandemic levels by mid-2025, with tourist numbers projected to climb from 35.3 million in 2024 to 40 million. Private consumption is set to benefit from fiscal measures such as the Digital Wallet cash transfer program, which preliminary estimates suggest boosted GDP growth by 0.3 percentage points in 2024 at a significant fiscal cost of THB 145 billion or 0.8% of GDP.
The poverty rate fell to an estimated 8.2% in 2024, supported by economic recovery and cash transfers, while inequality decreased by about 1.5 Gini points. Inflation for the coming year is forecasted at a modest rate of 0.8%, still below the central bank's target.
Goods exports are likely to experience slight moderation due to slower growth in major markets like the United States and China, despite an upturn in global electronics demand.
To bolster fiscal resilience amid rising expenditures, Thailand must focus on targeted social assistance programs, enhance tax revenue mobilization, and accelerate public investments in infrastructure, technology, and human capital development.
Monetary policy should remain cautiously accommodative with a focus on providing targeted household debt relief while ensuring financial stability.
Structural reforms aimed at enhancing economic competitiveness are deemed necessary for sustaining long-term growth prospects. Without these reforms, Thailand's potential growth could decline from an average of 3.2% during the period between 2011-21 to around 2.7% over the next decade (2022-30), potentially hindering its high-income status ambitions.
Thailand has made considerable progress socially and economically over recent decades but faces challenges that require innovation-driven solutions for further advancement toward higher income levels and improved living standards.
Small and medium-sized enterprises (SMEs) play a crucial role in reigniting economic growth as they represent a significant portion of firms (99.5%), national employment (69.5%), and overall GDP (35.3%). However, limited innovation within SMEs presents untapped potential for contributing more substantially to productivity gains through greater participation in global value chains.
Four primary challenges confront SMEs: limited access to financing; insufficient support infrastructure like incubators; inadequate future-ready skills; and regulatory barriers related primarily towards fair competition alongside trade & investment issues—all factors explaining why relatively few entrepreneurs break into markets particularly within digital sectors vital for productivity enhancements via innovative practices
Addressing obstacles across research-development-financing-skills development-enhancing competition-market access can help position Thailand better regionally regarding leadership roles associated with driving innovations forward collaboratively among various stakeholders involved ensuring alignment-efficiency throughout policy implementations ultimately achieving desired outcomes successfully together collectively working towards shared goals benefiting everyone involved positively overall