Thai Economic Growth Slows In Q2

(RTTNews) - Thailand's economy grew at a softer pace in the second quarter largely due to the slowdown in tourist arrivals, official data revealed on Monday.

Gross domestic product expanded 2.8 percent year-on-year in the second quarter, slower than the 3.2 percent growth posted in the first quarter, the National Economic and Social Development Council said.

On a quarterly basis, GDP growth slowed marginally to 0.6 percent from 0.7 percent in the first quarter.

In the first half of the year, Southeast Asia's second-largest economy expanded 3.0 percent from a year ago.

The government forecast the economy to expand within the range of 1.8 - 2.3 percent this year compared to the previous projection of 1.3 -2.3 percent. The growth was estimated to decelerate from 2.5 percent in 2024.

The slowdown in economic growth this year was primarily attributed to the anticipated fall in goods exports in the second half of the year, following the implementation of US tariff measures.

Moreover, the economy faces risk from high levels of household and corporate debt, volatility in agricultural prices and production, and uncertainties surrounding global trade and economic conditions, the NESDC said.

Headline inflation is expected to remain within the range of 0.0 - 0.5 percent and the current account is projected to register a surplus of 2.1 percent of GDP.

On the expenditure side of GDP, household consumption increased 2.1 percent, following a 2.5 percent rise in the prior quarter primarily due to slower growth in services expenditure. Government spending climbed 2.2 percent after a 3.4 percent rise mainly owing to weaker growth in compensation of employees and spending on goods and services.

Annual growth in gross fixed capital formation accelerated to 5.8 percent from 4.7 percent due to a rebound in private investment.

Exports of goods and services surged 12.2 percent after a 12.3 percent increase. Meanwhile, the increase in imports of goods and services increased sharply to 10.8 percent from 2.1 percent.

On the production side, the manufacturing and the wholesale and retail trade sectors accelerated, while the agriculture, accommodation and food service, construction, and transportation and storage sectors registered slower growth.