UTCC slashes Thailand 2024 growth forecast from 3.2% to 2.6%

The big cut by the university’s Centre for Economic and Business Forecasting was mainly due to the global economic slowdown, explained UTCC rector Thanawat Phonwichai.

He cited the International Monetary Fund reducing its global economic growth forecast from 3.5% to 3.3% amid ongoing conflict in the Red Sea.

In October, Iran-backed Houthi rebels in Yemen launched missile and drone strikes against Israel in response to its Gaza offensive. They have also targeted cargo ships transiting the Red Sea, disrupting one of the world’s most important trade routes.

Thanawat said Thailand’s economic growth would also be hampered by a slowdown in private-sector consumption and investment as well as delays in disbursement of government budget and investment.

However, Thailand could achieve 3.1% GDP growth if the government’s digital wallet scheme disburses 10,000-baht payments to 15 million people on schedule, according to the UTCC centre.

It said the best-case scenario was 3.8% growth, if the digital wallet scheme expands to more recipients and the number of foreign tourists reaches 26 million this year.

The centre calculates that every 100 billion baht spent under the digital wallet scheme will boost GDP by 0.26%.

GDP would be boosted by the same amount for every one million foreign arrivals, and by 0.56% for every 100 billion baht of spending by foreign tourists, it said.

Meanwhile, every 100 million baht in government spending to stimulate consumption would expand the economy by 0.52%.

Finally, GDP would grow by 0.68% for every 100 billion in investment by the government, Thanawat said.