S&P keeps Thailand at BBB+, JSCCIB urges structural reform to sustain confidence

S&P Global Ratings has affirmed Thailand’s sovereign credit rating at BBB+ with a stable outlook, citing continued economic recovery and resilient external fundamentals.

Jindarat Viriyataveekul, Director of the Public Debt Management Office, said on June 18 that S&P’s latest review projected Thailand’s real GDP growth at 2.0% in 2026, reflecting pressure from volatility in global energy markets that continues to weigh on domestic economic activity.

However, S&P expects Thailand’s economy to recover gradually from 2027 onwards, with average growth of around 2.3% during 2026–2029. Income per capita is projected to rise from around US$8,000 in 2024 to US$9,000 in 2026, partly supported by a stronger baht.

S&P also said political stability under the new government should support policy continuity and enable long-term structural reforms and investment plans, particularly in the Eastern Economic Corridor (EEC) and major transport infrastructure projects. State enterprises and public-private partnerships (PPPs) are expected to play a key role in enhancing competitiveness.

In the tourism sector, foreign arrivals fell by around 2.4% year-on-year in the first quarter of 2026. However, S&P expects government support measures and domestic tourism promotion to help sustain value creation in the sector.

On fiscal policy, S&P forecasts Thailand’s budget deficit at around 3.2% of GDP in 2026 and 2027, while net government debt is expected to rise to 3.5% of GDP in 2026 before gradually easing to an average of 3.1% between 2026 and 2029. The agency said this reflects continued fiscal support to sustain economic recovery and cushion external risks.

Thailand’s external position remains strong, with the current account projected to record a surplus of around 2.0% of GDP in 2026 and an average of 2.1% over 2026–2029, supported by solid foreign reserves and external financial stability.

S&P said it will continue to monitor several key factors, including Thailand’s growth performance relative to peers, income levels, fiscal consolidation trends and domestic political stability, all of which influence long-term policy continuity.

Payong Srivanich, Chairman of the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB), said S&P’s decision to maintain Thailand’s BBB+ rating and stable outlook is consistent with Moody’s earlier affirmation at Baa1 with a stable outlook.

He said this reflects continued investor confidence in Thailand’s macroeconomic and fiscal management, as well as strong external financial buffers that help the country withstand global economic volatility, geopolitical risks and shifts in global trade dynamics.

The private sector group said Thailand’s credit affirmation signals strong economic fundamentals and policy continuity, supporting structural reforms and new investment aligned with global trends.

However, it stressed that long-term confidence requires accelerated structural reforms to enhance competitiveness and shift the economy towards productivity, innovation, quality and sustainability.

The JSCCIB also urged the government to pursue targeted economic policies alongside fiscal discipline, prioritising high-return investments across supply chains while reducing broad-based subsidies that could create long-term dependency.

It further supported Thailand’s bid to join the OECD, which would help raise standards in rule of law, governance, transparency and open government practices.

The private sector also backed deeper cooperation with international organisations, including the World Bank, to strengthen key industries and support Thailand’s economic transformation under the “Reinvent Thailand” framework.

JSCCIB said the private sector stands ready to fully support the government’s reform agenda through investment, supply chain upgrading, SME development and public-private collaboration via existing joint committees.

It added that maintaining macroeconomic stability and fiscal discipline, combined with clear and actionable reforms, would strengthen investor confidence and support Thailand’s long-term transition towards a more competitive, value-driven and sustainable economy with stronger national champions.