World Economy

Thai Q1 Growth 3.2%

Thai Q1 Growth 3.2%Thai Q1 Growth 3.2%

Thailand’s economy grew by a more than expected 3.2% in the first quarter off the back of strong tourism and public spending, official figures showed Monday, but analysts warned the solid start was still shaky.

Once one of Southeast Asia’s most vibrant and successful economies, Thailand has struggled with lackluster growth fuelled by more than a decade of political instability and slowing demand for its exports, AFP reported.

Thailand’s generals, who seized power in a May 2014 coup, have struggled to fulfill their pledge to kickstart the economy, which is also hampered by high household debt and low consumer spending.

The country’s vital farming sector has been hit hard in recent months by one of the worst droughts in decades.

But figures released by the National Economic and Social Development Board on Monday showed the junta’s spending drive, a stimulus package worth some $11 billion since last year, was starting to pay dividends.

The quarter one growth rate of 3.2% was the highest in more than two years and higher than the 2.8% median estimate from a Bloomberg News survey of 21 analysts.

The NESB also slightly revised their yearly growth rate to a more confident bracket of between 3% and 3.5%.

Nonetheless Thailand still boasts one of the most disappointing growth rates in the region. Tourism accounted for nearly all of last year’s 2.8% growth.

 “High household debt and continued political uncertainty are likely to drag down growth again over the coming quarters,” Krystal Tan of Capital Economics, said in a briefing note.