Thailand’s economy is developing, and it is a recently industrialized nation. In regards to nominal GDP, Thailand’s economy ranks 26th in the globe, 8th in Asia-Pacific, and 2nd in Southeast Asia (SEA) after Indonesia.
Thailand has made significant progress in its socioeconomic growth during the previous forty years. Additionally, it managed to go up from a low-income nation to a high-income one in a single generation. Due to its ability to continue rapid economic growth while also significantly reducing poverty, the nation has gained widespread recognition as a success story in development.
There are around 70 million people living in the nation, and 33 million people are employed. Despite a per capita GDP of roughly $7,200, Thailand has reduced poverty from 58% in 1990 to 6.8% in 2020 as a result of structural reform and fast growth.
Thailand managed to keep its rate of unemployment at only 1% in 2020 despite the consequences of the Covid-19 epidemic. Nevertheless, the rate rose to 2.25 percent in 2021, and as of September 2022, Thailand’s rate of unemployment was 1.1 percent, or barely under the 20-year average of 1.2 percent. The lower rate of unemployment in the nation is a result of factors like the low birth rate, the absence of social insurance, and the large number of individuals working in the unorganized sector.
The GDP of the Asia-Pacific region’s eighth-largest economy rose at a 9.5% annual rate between 1987 and 1996, before slowing to 3.9% between 2000 and 2014. Due to successive waves of COVID-19, Thailand’s economy saw a staggering 6.2% GDP decline in 2020.
The government implemented a total of four economic stimulus measures in 2021 to help the economy recover from the pandemic-driven slowdown. Thailand’s GDP grew 1.6% in 2021 as a result of the easing of countermeasures and the openness of the nation.
In its most recent forecast, the International Monetary Fund (IMF) predicted that Thailand’s GDP will increase by 2.8% in 2022. The international body projects a 3.7% growth rate for the nation in 2023. The updated forecast’s lower revision is attributed to rising living expenses and tightening financial circumstances.
Currency and Central Bank of Thailand
Thailand’s baht, which is divisible into 100 satangs, is the country’s legal tender. The Thai baht was regarded as having the best performance globally in 2018 by Bloomberg. Governor Sethaput Suthiwart-Narueput presently oversees the Bank of Thailand (BOT), which acts as the nation’s central bank. By fostering a stable financial climate for long-term economic growth, it seeks to continuously raise the standard of life for all residents of the nation.
The BOT has increased its benchmark rate of interest three times since August 2022 for a total of 75 basis points (as of December 2022). The central bank declared that it will keep raising rates until both the economy and inflation reached their respective goal ranges of 1% to 3%. Over a three-month period, core inflation decreased from 6.41% in September to 5.98% in October to 5.55% in November 2022.
A Brief Overview of the Thai Economy
As we said before, Thailand is a developing country with the second-best economic performance in Southeast Asia. The GDP surpassed US$510 billion in 2021. The foundation of the economy is made up of the service sector, which contributes more than 50% of the GDP, tourism, industry, and agriculture.
The Kingdom ranks fourth in the area for both mineral reserves and industrial development. About 2/3 of the country’s GDP comes from exports, which are a major contributor to economic growth. Manufacturing of electrical appliances makes up the majority of Thailand’s exports or around 15% of all exports. Thailand, the largest producer of pickup trucks in the world with an annual export of 200,000 units, leads ASEAN in the manufacturing and sales of vehicles.
In terms of gypsum exports, Thailand is in second place to Canada and is one of the major producers of tin and wolfram for the global market. Shrimp, coconuts, corn, soybeans, and sugarcane are among its top exports, along with soybeans and corn.
The Main Import Items Are:
- Electrical apparatuses and devices
- Mineral-based fuels, such as oil
- Industrial equipment
- Jewelry and other precious metals
- Iron metals, such as steel
- Plastics, including plastics-related products
- Merchandise formed of ferrous metal
- Equipment for optics, technology, and medicine
- Organic substances
The following Belarusian firms have the most promising export opportunities to Thailand:
- Synthetic materials (polyamides, fiberglass)
- Dairy products (powdered skim and whole milk, milk whey, and newborn formula)
- Optical measuring devices and apparatus
- Pharmacological items
Industry and Trade
Agribusiness, industry, and services make up the three sectors that make up the Thai economy. The nation is among the top rice producers and exporters in the world and is regarded as the world’s largest producer of natural rubber. Despite employing 49% of the workforce and only making up 8% of the GDP, the agricultural industry. The GDP contribution of agriculture is falling as a result of Thailand’s increased exports of commodities and services.
In the meantime, the industrial sector accounts for 33.4% of the GDP and employs 22.5% of the workforce. Thailand’s biggest industries include steel, automobile, and electronics. The nation also produces electrical parts and appliances, computers, cement, furniture, and plastic goods. It also serves as a hub for the assembly of various worldwide auto brands. In the meantime, the service sector accounts for 58% of GDP.
In the year prior to the epidemic, 40 million international visitors came to Thailand, supporting 20% of the nation’s employment needs and 11% of its GDP. In 2019, 30% of all tourists from China spent money in Thailand. However, the pandemic had a devastating impact on the sector, as only about 430.000 visitors visited the nation in 2021, down from 6.7 million in 2020. But as a result of the slow reopening, there will be more visitors from abroad in 2022; at the end of August, that number was 4.4 million.