Bangkok: The National Economic and Social Development Council (NESDC) has revised its GDP growth forecast for 2026 to 2 percent, down from 2.4 percent in 2025. The council anticipates that the new government will drive economic growth despite the lowered expectations.
According to Thai News Agency, Mr. Danucha Pichayanant, Secretary-General of the NESDC, outlined the economic outlook for 2025. He noted a 2.5% GDP growth in the fourth quarter, driven by exports (5.6%), construction (11.2%), and increased spending on government training budgets. The unemployment rate fell to 0.71%, compared to 0.88% in the same period last year, paving the way for a 2.4% GDP growth in 2025, supported by exports and tourism.
As preparations for a new government continue, the current administration, led by Anutin Charnvirakul, is negotiating with the Pheu Thai Party and smaller parties to form a coalition. The aim is to implement economic stimulus measures and prepare the 2027 fiscal budget. Should the government be established by March or April 2026, following the Election Commission's certification, the budget process would face a minimal delay, with funds expected by October-November 2026.
The NESDC's revised GDP growth forecast for 2026 increased from an earlier estimate of 1.7% to 2%. This adjustment considers a -0.3% contraction in exports, which are anticipated to grow by 1.7%, contingent on domestic component usage, progress in US tariff talks, a current account surplus of 2.4%, an inflation rate of 0.2%, and global economic growth of 3%. The NESDC also predicts 35 million foreign tourists generating 1.65 trillion baht in revenue, compared to 33 million tourists and 1.47 trillion baht in 2025.
Global trade volatility, high household debt, low bank lending, particularly for auto loans and SMEs, and rising non-performing loans pose significant constraints. Severe weather conditions, potentially leading to floods and droughts, could increase the government's relief burdens. The European Union's CBAM regulations mandate adaptations by the private sector, requiring carbon credit purchases. Fiscal discipline remains crucial, as it influences global credit rating agencies' assessments of the country's creditworthiness, thus limiting budget and borrowing use to drive the economy.