Thailand’s economic growth in the third quarter of 2023 expanded by 1.5%, according to the Office of the National Economic and Social Development Council (NESDB). This figure fell below market expectations, which anticipated growth in the range of 2.0-2.2%. The subdued growth marks a deceleration from the 1.8% expansion witnessed in the second quarter of 2023, primarily driven by continuous contractions in total exports over four consecutive quarters since the fourth quarter of 2022.
Despite an increase in foreign tourist arrivals, the reduction in government spending, particularly in public health expenditures related to COVID-19, impacted the economic landscape. However, household consumption remained resilient, contributing to the ongoing expansion. Simultaneously, private sector investments accelerated, culminating in a 1.9% growth in the Thai economy over the first nine months of 2023.
The NESDB Secretary-General highlighted the consistent contraction in Thai exports, which have shrunk for three consecutive quarters in the current year and for four quarters when considering the previous year. The decline in exports significantly influenced the Q3/66 expansion, contributing to the ongoing economic challenges.
The slowdown in domestic production, both in agricultural and non-agricultural sectors, played a pivotal role in the deceleration, along with reduced government spending, declining exports and imports of goods, and a slowdown in export expansion. However, household spending and total investment continued to grow, underscoring some resilience in specific sectors.
The NESDB report detailed a moderation in expansion across agricultural, service, and industrial sectors, while government consumption expenditure decreased. Private final consumption expenditure saw a significant rise, accompanied by an acceleration in total investment. Additionally, while the expansion of goods and services for exports tapered off, imports of goods and services continued their decline.
Thailand’s economic performance in Q3/66 reflects a mixed landscape characterized by subdued growth rates impacted by persistent challenges in the export sector, despite certain segments of the economy displaying resilience and growth.