Thailand Faces 2.3% Growth as Debt and US-Iran Tensions Cloud Recovery

1 articles · Updated · Nation Thailand · Jul 13

Thailand’s economy is projected to grow just 2.3% this year, with stronger exports and AI-linked investment failing to offset weak competitiveness and heavy household debt.
Double-digit export growth and a pickup in private investment have supported second-half momentum, but much of the AI and electronics investment carries high import content, limiting the net domestic boost.
US-Iran tensions and instability around the Strait of Hormuz remain a key external risk, even as retreating oil prices have cooled inflation expectations to about 3% to 4% and reduced pressure for more rate hikes.
High household debt, tighter mortgage lending and excess housing supply are expected to keep the property market subdued, with current inventory likely taking at least two years to clear.
Dr. Pipat said Thailand should favor infrastructure and energy-transition spending over short-term consumption stimulus, arguing its deeper competitiveness problems remain unresolved despite a likely second-half recovery.