Trade conflicts, worsening climate, spread of fake news will impact Thai economy, warns NESDC

Danucha Pichayanan, secretary-general of the National Economic and Social Development Council (NESDC), said ongoing geopolitical conflicts between world superpowers have led to a rivalry not just over military and security matters, but also on economic issues.

“We have seen more challenges. They have started talking about changing the world’s major currency. The situation is fluid and Thailand needs to closely follow the developments,” Danucha added.

“This poses risks for Thailand, and we need to determine where the situation is heading and what’s going to happen to the country.”

The NESDC chief was delivering his keynote address on “Transitioning Thailand: Coping with the Future” at the annual NESDC meeting.

He also pointed to certain “abnormalities” that have adversely affected the global economy over the past three years. These include the US-China trade war, the Covid-19 pandemic, the Russia-Ukraine conflict and high inflation in many countries. All these factors have had a negative impact on the Thai economy, he said.

Danucha also said that the US is suffering an economic recession, even though its inflation is declining. Inflation, however, is still high in other regions, especially Europe, while China, the world’s second-largest economy, is experiencing an economic slowdown.

“We don’t know yet how big China’s economic problems are,” he added.

As for risks to the Thai economy, the NESDC chief pointed out that the country has seen more frequent natural disasters owing to climate change, which has adversely affected Thailand’s biodiversity and agriculture.

“India has decided not to export agricultural products due to the El Nino phenomenon. Though Thailand’s sale of farm products is still going well, we need to be careful about the country’s food security,” he said.

Danucha also pointed out that the deep political divide among Thais is also threatening the country’s economy. He blamed fake news spread through social media as a catalyst for worsening the social divide.

“This problem is becoming increasingly serious for the country,” he said, adding that a mechanism was required to verify fake news and young people should be educated about how to tell the difference between true and false facts.

“This problem must be tackled to ensure peace in society,” he said.

The NESDC secretary-general also said the World Economic Forum’s 2023 Global Risks Report identified five areas of short- and long-term risks facing the world, related to economic, social, environmental, geopolitical, and technological dimensions.

Imminent risks within the next two years include a crisis of high costs of living and inflation, natural disasters caused by extreme climate, geopolitical confrontations, as well as disunity and severe social division.

He said the WEF report also pointed to worsening risks to the world’s economy and geopolitical stability over the next decade due to several problems, including loss of biodiversity and ecosystem collapse, widespread cybercrime and cyber insecurity, and large-scale involuntary migration.