Thailand’s Economic Growth Projected to Slow This Year
The lender trimmed its 2026 growth projection to 1.6 percent, down from a 1.7 percent estimate issued in July 2025, citing weaker external demand and domestic financial strains.
In its latest assessment, the bank warned that merchandise exports are likely to lose momentum in 2026 after a surge driven by earlier front-loaded shipments. Industries exposed to U.S. tariff measures are expected to post slight contractions, though the electronics sector should remain resilient.
The World Bank's Thailand Economic Monitor identified escalating trade policy uncertainty as the chief external threat, cautioning that further tensions could curb exports, disrupt supply chains and erode investor confidence.
Tourism, a critical pillar of Thailand’s economy, also faces mounting pressures. Safety concerns, intensifying regional competition and evolving traveler behavior are clouding the sector’s outlook. At the same time, political uncertainty linked to the election cycle could slow passage and implementation of the 2027 fiscal budget, potentially constraining public expenditure.
Still, the report pointed to upside risks. Stronger-than-anticipated foreign direct investment, especially in electric vehicles, electronics and digital infrastructure, could lift factory output and improve productivity. A de-escalation in global trade frictions would further support industrial recovery.
Looking ahead, the bank projects growth will edge up to 2.2 percent in 2027, as global conditions stabilize, private investment gathers pace and approved FDI projects begin translating into tangible production gains and job creation.
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