Bangkok, March 17 – SCB EIC raises 2023 GDP to 3.9% driven by tourism and private consumption. and the global economy expanding better than expected. New risks arising from the global financial stability crisis must also be kept an eye on.
Dr. Somprawin Manprasert, Executive Vice President Chief Executive Officer Corporate Strategy Group and Senior Executive Vice President, Chief Executive Officer, Economic Intelligence Center (EIC), Siam Commercial Bank, said that SCB EIC has raised the Thai economic forecast for 2023 to 3.9% from the previous 3.4%, driven by the recovering tourism and service sectors, the number of foreign tourists in 2023. 2023 is expected to be at 30 million and will return to pre-COVID-19 levels by the end of 2024. It is expected that Chinese tourists will return to about 4.8 million after China lifts the zero-COVID measures sooner.
Other national tourists are expected to recover as well. This will help support the labor market and consumption to continue to recover. Exports are expected to expand by 1.2% in line with better-than-expected global economic growth and recovering demand from China. There are still 3 export markets that have potential and opportunities for Thailand, namely the Middle East market, the CLMV market, and the Latin American market. As for private investment, it is likely to expand in line with the improvement of business confidence, as well as the tendency to increase in the application and issuance of investment promotion certificates. As for headline inflation, it is expected to be at 2.7%, returning to the target range. This is in line with falling global energy prices and ongoing domestic energy subsidy measures. However, core inflation is expected to slow down to 2.4% but remain high. This reflected the gradual pass-through of costs from producers to consumer prices during a period of stronger recovery in the Thai economy and increasing demand-side inflationary pressures.
In addition, the situation of Silicon Valley Bank (SVB) in the US, which has a lack of liquidity and was shut down. It is expected that liquidity and confidence in global financial markets will decrease slightly in the short term. The risk of escalating to the global financial crisis like in 2008 is still minimal, but is seen as an important risk factor that needs to be monitored closely. as well as the risk of geopolitical conflicts between the United States. and China that could affect the economy, trade and the global supply chain.
Dr. Thitima Chucherd, Director of Economic and Financial Market Research Department, Economic Intelligence Center (EIC), said that the general election in 2023 could affect government spending. Depending on the speed of the announcement The 2024 Budget Act of the new government It is expected that the announcement will be delayed by no more than 3 months, but if there is political uncertainty that results in the announcement being delayed beyond the base case. It may affect government spending during this year and next year. especially public investment
SCB EIC expects that in the baseline scenario, Thailand’s policy interest rate will gradually increase in the first half of the year to 2% as the Thai economy tends to continue to recover. and Thai inflation will not decrease rapidly. The gradual end of financial assistance measures will cause the Thai financial conditions to continue to tighten The baht is likely to depreciate in the first half of this year. But it will appreciate to 32-33 baht per US dollar at the end of this year due to the strong Thai economic fundamentals. And the US dollar will return to weaken, especially after the Fed began to stop raising interest rates in the second half of the year.-Thai News Agency
Source: Thai News Agency
