Thailand’s Economy Defies Forecasts with 2.4% Growth in 2025
Thailand’s NESDC reports a surge in Q4 growth to 2.5%, driven by a decade-high spike in investment and a rush for EV incentives, beating initial forecasts
- Thailand's economy grew by 2.4% in 2025, outperforming initial forecasts due to a strong fourth-quarter performance.
- The growth was propelled by a decade-high surge in total investment, which climbed 8.1% in the final quarter of the year.
- A significant increase in consumer spending, fueled by a rush to claim expiring government EV subsidies, also played a crucial role in defying expectations.
Thailand’s NESDC reports a surge in Q4 growth to 2.5%, driven by a decade-high spike in investment and a rush for EV incentives, beating initial forecasts.
Thailand’s economy outperformed expectations in 2025, posting a full-year growth of 2.4% following a late-year surge in private investment and consumer spending.
Data released by the National Economic and Social Development Council (NESDC) on Monday revealed that Gross Domestic Product (GDP) grew by 2.5% in the fourth quarter.
This marks a significant acceleration from the 1.2% growth seen in the previous quarter and comfortably beats the agency's earlier conservative estimate of 1.7%.
Investment Hits 10-Year High
The star performer of the final quarter was total investment, which climbed by 8.1%—the sharpest increase the kingdom has seen since 2016. Private investment rose by 6.5%, bolstered by heavy spending on industrial machinery and office equipment.
Consumer spending also remained resilient, growing by 3.3%. This was largely attributed to a "buying frenzy" in the automotive sector, as motorists rushed to take advantage of the government’s EV 3.0 first-phase subsidies before the programme expired.
Consequently, spending on durable goods skyrocketed by 12.2% in the final three months of the year.
Mixed Fortunes for Exports
While the industrial sector saw a boom in the export of telecommunications equipment (+83%) and computers (+91%), other traditional pillars of the Thai economy faced headwinds.
Agricultural exports, particularly rice and rubber, dipped amid fierce price competition in global markets.
Furthermore, the automotive sector saw a sharp 36.2% decline in passenger car exports, even as the shipment of pickup trucks and jewelry surged. Despite these fluctuations, Thailand maintained a trade surplus of $23.3 billion for the full year.
The Road Ahead for 2026
Looking forward, NESDC secretary-general Danucha Pichayanan struck a note of cautious optimism. The council has set a growth target of 2% for 2026, within a forecast range of 1.5% to 2.5%.
"The momentum in 2026 will be sustained by continued private consumption, a recovery in the vital tourism and service sectors, and a boost in government capital expenditure," Danucha stated.
The council also noted that favourable weather conditions and ample water supplies are expected to support a rebound in agricultural production. Inflation for the coming year is projected to remain low, hovering between -0.3% and 0.7%.
