Thai economy's decline slows on eased lockdown, stimulus steps

BANGKOK (BLOOMBERG) – Thailand’s economy improved in the third quarter after the government eased restrictions on movement and implemented a series of stimulus measures while getting the country’s Covid-19 outbreak largely under control.

Gross domestic product shrank 6.4 per cent from a year ago, the National Economic and Social Development Council said on Monday (Nov 16), recovering from the prior quarter’s 12.2 per cent contraction at the peak of the outbreak. The figure was better than the median estimate of 8.8 per cent contraction in a Bloomberg survey of 19 economists.

With tourism and trade hit hard by the outbreak, Prime Minister Prayuth Chan-Ocha has spent hundreds of billions of baht in cash handouts and stimulus measures from a 1.9 trillion baht (S$84.6 billion) economic package to support local demand. Meanwhile, a strengthening currency and political protests pose risks to the fragile recovery.

The government wants the central bank to temper a rally in the nation’s currency, which is threatening its efforts to boost exports as an offset to the slump in tourism revenue. The baht has surged in the past month as foreign inflows resumed into Thai stocks and bonds. Bank of Thailand Governor Sethaput Suthiwart-Narueput said last week that the country’s high foreign reserves and low foreign debt will help it weather the crisis, which will take time and targeted remedies to resolve.

Around 3 million workers have been affected by the pandemic, with 700,000-800,000 people rendered jobless.

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