Finance Ministry seeks clarification from NESDC over unusually weak Q3 GDP and sharp inventory drop
The Finance Ministry will request a meeting with the NESDC after Q3 GDP grew just 1.2%, with officials questioning an unexplained 100-billion-baht fall in inventories that dragged growth into negative territory.
A source at the Ministry of Finance revealed that the ministry will ask for a formal meeting with the National Economic and Social Development Council (NESDC) following the release of Thailand’s Q3 GDP figures, which showed growth of 1.2% year-on-year and a contraction of 0.6% quarter-on-quarter — well below expectations.
“The GDP figure announced by the NESDC was lower than forecasts by the Finance Ministry, the private sector, and even the Bank of Thailand. When we examined the details, we found that inventories had fallen by over 100 billion baht compared with last year. We need clarity on where this decline came from,” the source said.
The Finance Ministry’s internal analysis showed that inventories had dropped by more than 100 billion baht from the previous quarter, contributing approximately –1.9% to GDP compared with the same period last year.
Officials find this inconsistent with other data — particularly the 19% surge in exports in October, signalling strong incoming orders.
“Normally, if manufacturers see new orders coming in, they increase production and build up stocks. But here, inventories plunged sharply — the opposite of what economic conditions suggest. If inventory data had been adjusted to reflect actual economic activity, GDP might not have appeared so weak,” the source explained.
The Ministry wants the NESDC to clarify which product categories contributed to the steep drop, as the published documents do not specify whether the decline was in gold, rubber, rice or industrial goods.
Such details are essential to determine the true cause. For example, if agricultural goods were responsible, officials could ask the Agriculture Ministry whether rubber or rice stocks really failed to enter warehouses, as the data implies.
Outlook for Q4
Based on first-three-quarter growth of 2.4%, Thailand needs only 0.8% growth in Q4 to achieve the Finance Ministry’s full-year GDP target of 2%.
However, the source said Q4 growth is likely to exceed 1%, and recession is unlikely due to multiple positive drivers, namely the Let’s Go Halves Plus co-payment scheme, tourism stimulus measures, which take effect in Q4, and additional ministry-level economic measures.
“The Finance Ministry believes Q4 GDP will be better than 0.8% — it may reach 1.1%, as Deputy PM Ekniti Nitithanprapas has suggested. We are confident the figure will not begin with zero,” the source said.
