Thailand’s economy grew by 3.0% in the third quarter exceeding 2.6% forecast

Thailand’s economy expanded by 3.0% in the third quarter compared to the previous year, marking the fastest growth rate in two years.

Key takeaways

• Thailand’s economy grew 3.0% year-on-year in Q3 2024, surpassing the 2.6% forecast, driven by improved domestic and export performance.  
• Seasonally adjusted quarterly growth reached 1.2%, the highest in 18 months, reflecting a recovery from Q2’s subdued performance.
• The Tourism Authority of Thailand expects to welcome 36 million foreign tourists, generating around $51.5 billion in revenue this year, marking a strong rebound from COVID-19 lockdowns in 2020.
• High household debt, borrowing costs, and weak Chinese demand continue to weigh on Thailand’s long-term economic prospects, necessitating structural reforms.  

The performance exceeded analysts’ median forecast of 2.6% growth, as surveyed by Reuters.  On a quarter-on-quarter basis, Southeast Asia’s second-largest economy recorded seasonally adjusted growth of 1.2%, the highest pace in 18 months.

Thailand expects to welcome 36 million foreign tourists, generating $51.5 billion in revenue. The economy is projected to continue growing in the fourth quarter, with support from tourism, government spending, and investment. However, there are concerns about a potential impact on exports due to new import policies in the U.S. 

This figure also outperformed expectations, which predicted a modest 0.8% expansion, according to the National Economic and Social Development Council (NESDC).  

The July-September data reflects a rebound from the second quarter’s weaker performance, where annual growth was revised downward to 2.2% and quarterly growth stood at 0.8%.  

Looking ahead, the NESDC has projected GDP growth of 2.6% for 2024, aligning with its earlier forecast range of 2.3% to 2.8%. For 2025, the agency anticipates growth to range between 2.3% and 3.3%.  

Despite the upbeat quarterly figures, Thailand’s economic challenges remain significant. Last year’s GDP growth of 1.9% lagged behind regional peers, hampered by elevated household debt and high borrowing costs that have restrained domestic consumption.

Additionally, sluggish demand from China, one of Thailand’s key trading partners, continues to weigh on exports and broader economic performance.  

Finance Minister Pichai Chunhavajira has acknowledged the ongoing pressures, stating that the government will review new stimulus measures on Tuesday.

Among the proposals is the second phase of the “digital wallet” scheme, which aims to bolster consumer spending and stimulate economic activity.  

Analysts suggest that while the latest data reflects a recovery, sustained growth will depend on addressing structural economic issues. These include alleviating household debt and fostering diversification to reduce dependence on external demand.  

Thailand’s government is expected to roll out targeted policies to stabilize the economy amid global uncertainties. With regional competition intensifying, the kingdom faces a critical juncture in ensuring its recent growth momentum translates into long-term resilience.