Bangkok: The Ministry of Finance reveals that GDP in 2025 will grow by 2.2 percent, factoring in Thai-Cambodian border clashes, northern region flooding, and impacts from Trump’s tax bill. The Ministry remains optimistic that a stimulus budget will help rejuvenate the border economy, while foreigners caution tourists about border-related incidents, which are not expected to affect the broader economic outlook.
According to Thai News Agency, Mr. Pornchai Thiravej, Director-General of the Fiscal Policy Office and spokesperson for the Ministry of Finance, announced Thailand’s economic projections for 2025, estimating a 2.2 percent annual GDP growth. This projection aligns with the IMF’s forecast of 2 percent growth and a 3 percent growth rate for the global economy, surpassing the previous 2.1 percent economic projection. The forecast considers factors such as Thai-Cambodian border violence and northern region flooding.
Several supportive elements are identified, including a projected 5.5 percent annual expansion in exports, driven by accelerated imports from trading partners. However, Thai exports may slow in the second half of 2025 due to US import tariffs. An agreement is anticipated to ease these tariffs, which range from 15-36 percent, by the third quarter. Domestically, stability is expected, with an inflation rate of 0.4 percent and a current account surplus of US$14.6 billion, or 2.9 percent of GDP, derived from the trade surplus.
Efforts are underway to address and resolve border issues, with government agencies and state banks collaborating. The remaining 42 billion baht from the central budget and the economic stimulus budget may be reallocated to align with the 157 billion baht stimulus budget’s goals, which include infrastructure development, export impact mitigation, tourism development, and community economy enhancement. An additional economic stimulus plan for the year’s second half is also in consideration, utilizing 25 billion baht from the 2016 budget to boost the national economy.
Despite economic challenges on the Thai-Cambodian border, the Ministry of Finance assesses that the violence is confined to the border area, with border trade constituting only 1.4 percent of total trade. Major Thai tourist attractions are located away from the border, and several countries have advised citizens against visiting risky areas within a 50-kilometer border radius, minimizing the impact on overall tourism. The Ministry still anticipates 34.5 million foreign tourists visiting Thailand this year, generating 1.62 trillion baht in revenue, with an average spending of 46,900 baht per person.
The Ministry of Finance spokesperson emphasized that the Thai economy is expected to perform well in the year’s first half, recognizing challenges from US import tariffs, which affect Thailand directly and indirectly. Measures are in place to address and mitigate these challenges, including special low-interest loans through state-owned banks. Concerning the Thai-Cambodian conflict, the government has extended the advance credit limit to 100 million baht per province, with further expansion considered if necessary. Tax payment deadlines have been extended, and low-interest loans and debt repayment suspensions are provided to revitalize the Thai-Cambodian border economy.