Following improved confidence within the household and business sectors after a raft of state stimuli announced at the 2015 yearend, domestic spending began to exhibit positive signals. As such, we at KResearch believe that domestic economic activity during 4Q15, i.e. public and private spending and burgeoning tourism around the New Year, should help cushion the blow of ailing exports. Furthermore, such vigorous activity will likely help the Thai economy maintain positive momentum toward recovery until the end of 2015. It is expected that 4Q15 GDP growth will edge upward to 1.2 percent QoQ, s.a., versus the 1.0 percent QoQ, s.a., for 3Q15.
KResearch projects that 2015 GDP growth may reach 2.8 percent, bettering 2014's 0.9 percent gain. Granted, it is obvious that economic mechanisms in various sectors have failed to normalize, particularly exports and farm income that have been pressured throughout the year. It is predicted that those challenges facing both sectors will persist in 2016.
Looking into 2016, the outlook is brighter on the prospect that the Thai economy should improve with as much as 3.0 percent GDP growth, or within a 2.5-3.5 percent range. The government will continue to play a key role in injecting money into the system and restoring private sector confidence. However, it remains doubtful as to whether other determinants will support a rebound. Notable constraints include some trade partners' fragile economy and erratic global commodity prices. Bearing these factors in mind, KResearch remains cautious in assessing Thailand's economic recovery.