The Thai economy remained resilient through the first three quarters of this year, amidst the sharp rise in food and fuel prices. 

Real GDP growth in 2008 is expected to be 3.9 percent as the global economic slowdown and domestic political unrest weigh upon growth in the last quarter.

Thailand's real GDP is projected to grow by 2 percent next year. The impact of the global financial crisis on the Thai financial sector, on the other hand, has so far been limited. Strong external accounts have enabled Thailand to withstand the contraction in global liquidity. 

The banking sector remains sound, but individual banks needs to be closely monitored. Loan growth, however, will slow down next year. Expansionary monetary policy has been employed to help to mitigate the impact of the global financial crisis.  

Measures will be needed to mitigate the short-term impact of the global crisis on low-income groups and small and medium enterprises (SMEs).  The government has implemented several measures in 2008 to mitigate the short run impact of rising inflation and falling incomes. 

However, measures for the medium term that will enable Thailand to poise itself for higher and sustainable growth as the global economy recovers in the next few years are no less important.

In order to ensure Thailand's competitiveness in the near future, Thailand needs to improve its productivity and investment climate.

Clarity and continuity in policy directions and greater public infrastructure investments are needed not only to help stimulate growth in the short-run, but also improve productivity for the longer-term growth.

Download the executive summary (33kb pdf)

back to top