2023-08-14 07:30:00
But in the past 10 years we will feelThai economynot expanding very well which numbers of GDP growth For example, before the outbreak of COVID-19, ie 2014-2019, world GDP grew on average 3.1% per year during the same period. Thai GDPaverage annual growth of 3.0% (during the previous year, 2000-2009, Thailand’s GDP grew at an average of 4.3% per year)
The IMF estimates that Global GDP will grow at only 3% per year in 2023 and 2024 (down from 3.5% growth in 2022). Thailand expects GDP growth of 3.6% in 2023 and 3.8% in 2024.
One reason is The severe decline in the Thai economy during the COVID-19 outbreak, that is, in 2020, the global GDP was negative 3.1%, but the Thai economy was negative 6.1%, and in 2021, the world GDP recovered and increased by 6.0%, but G Thai DP rose only 1.5%
Even in 2022, when global GDP increased by 3.1%, Thai GDP might grow by only 2.6%, meaning that Thailand may recover better than the global economy. Because the Thai economy is much deeper than the global economy, that is, it is a matter of catch-up recovery.
And how to recover better than the global economy? The answer is the recovery ofChinese economyandtravel But we know that Chinese economyThe recovery is not as fast or as strong as expected for several reasons. (which I will explain in the future)
fortravelIt must be said that it has been the engine that has driven the Thai economy continuously for at least the past 15 years, for example, during the 5 years before the outbreak of COVID. The number of tourists increased from 25 million in 2015 to 40 million in 2019, representing an average annual growth of 10%.
While the GDP of Thailand grew by only 3% per year, meaning that if tourism did not expand like before Thailand’s GDP is likely to grow less than 3% per year.
If you analyze it further in depth, you will see that Before the outbreak of COVID-19, the expansion of the Thai economy relying on the current account surplus as the main factor, during 2014-2020,
1. Thailand has an average current account surplus of 30 billion dollars per year, or approximately 6-8% of GDP, which is likely to be the factor that drives almost all of Thailand’s GDP. the current account surplus It means purchasing power in Thailand is growing slowly. therefore having to mainly sell goods and services to foreigners
2. But during the same period capital outflowEvery year, the average net outflow is nearly 20,000 million dollars per year, so there is still a surplus. As a result, Thailand’s reserves increased from $180 billion in 2014 to a peak in 2020 of $286 billion, helping the baht appreciate. And inflation is consistently low as well.
But the key point for the next 5-10 years is We will be able to do the same. (i.e. a current account surplus of 30,000 million dollars per year) or not
Thailand has a current account deficit of $10.6 billion in 2021 and another $14.7 billion in 2022, but the situation improved in the first half of this year.
is a surplus of 1,600 million baht, but Thailand has a deficit in the balance of payments (Balance of Payments) in recent times. (capital still flowing out) can be seen frominternational reservesin Thailand, which decreased from a peak of US$ 286 billion in 2020 to US$ 252 billion in July 2023 (including forward positions, net reserves).
In an era when the world enters into a situation where interest rates may be at a high level for longer than expected. Because developed countries still have to try to suppress inflation. It increases the risk that the GDP of these countries. will grow at a slower pace (OECD estimates member countries’ GDP will grow only 1.4% in 2023 and 2024).
At the same time, the Chinese economy recovered less than expected. and there is a risk of enteringdeflation (deflation) This is not a joke.
On August 6, the Financial Times (FT) reported a news story titled “Chinese Economists told not to be negative as rebound falters.”
The news story is a respected economist. Seven well-regarded economists told the FT that they were ordered by their employers to Do not talk regarding some things A spokesman for China’s National Bureau of Statistics said: “Deflation does not and will not exist in China” Another famous economist said that “As the entire market is aware there is no such thing as deflation in China…We might talk (only) regarding low inflation”
One of the countries experiencing the worst deflation is Japan As a result, Japan’s GDP in 1993 was $4.45 trillion, and 30 years later in 2022 it’s still $4.23 trillion (source World Bank).
But China’s GDP is higher, $ 18 trillion in 2022, so if it enters deflation. It will make the recovery of the global economy. greatly weakened The IMF expects that in the next five years, China’s GDP growth will drive 22.6% of total global economic growth.
As for Thailand, it is highly dependent on the Chinese economy in many dimensions as you already know.
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