Thailand's Economy Stumbles as Regional Peers Improve

Thailand's growth is lagging against its Southeast Asian rivals. The region is showing marked resilience post-pandemic, with countries like Indonesia, the Philippines, and Vietnam posting over 5% economic growth. Malaysia, a key economy in the bloc, has seen a 3.7% rise. Thailand, by comparison, only grew by 1.9% last year.

As far as future growth prospects go, The World Bank projects only a modest improvement for Thailand in 2024, forecasting a 2.8% growth, while other Southeast Asian nations expect between 4.3% and 5.8%.

Compounding the issue is Thailand's household debt, which, according to the Bank of Thailand, has swelled to nearly 87% of GDP, burdened further by an estimated $1.5 billion in high-interest informal loans. 

The country's new leader, Prime Minister SretthaThavisin, describes the situation as a crisis but is focused on looking outwards, rather than inwards, in the short term. Srettha has been promoting Thailand globally in a bid to attract trade and position it as an essential player in manufacturing supply chains. 

Analysts argue that without significant reforms, especially in the digital and educational realms, Srettha's efforts may fall short. Two-thirds of Thais lack basic literacy, and three-quarters have inadequate digital skills, the World Bank reports.

If Thailand does not pivot towards emergent technologies like artificial intelligence, it risks falling even further behind its neighbors. For many Thais, that is looking too far into the future, as the sluggish economy translates into tangible hardships in everyday life in present day.