February 15, 2016
BANGKOK (AFP) - Thailand's economic growth accelerated in 2015, official figures showed Monday, after the junta boosted spending to pump up an economy that has wilted amid years of political turmoil.
High household debt, weakening exports, slumping foreign investment and low consumer confidence have cramped growth in what for years was Southeast Asia's flagship economy.
The ruling military has tried to spend its way out of the malaise, especially on farmers who have been hit by slumping global commodities prices and now face severe drought.
As a result gross domestic product rose 2.8 percent last year, according to data from the Office of the National Economic and Social Development Board, rebounding from 0.8 percent in 2014, its slowest rate in three years.
While state spending will likely continue, analysts have cooled expectations for 2016.
"We doubt growth will pick up strongly this year," said Krystal Tan of Capital Economics in a briefing note, forecasting GDP of three percent for 2016.
"Thailand's unstable political situation will continue to hang over the outlook for private investment, while high levels of household debt will keep private consumption growth subdued."
Exports are also on the wane in line with a tailing-off in global demand, she added.
It also faces stiff competition from increasingly attractive neighbours like Vietnam, Cambodia and Myanmar.
The Thai junta is struggling to deliver growth and political stability, chasing off foreign investors and discouraging consumers from spending.
Analysts say prolonged failure to grow Thailand's economy could see the junta eventually lose support among Bangkok's influential middle-class, many of whom supported the 2014 coup.
Total investment applied for by foreign companies between January and November 2015 plunged 78 percent from a year earlier to 93.8 billion baht ($2.62 billion), the state-run Board of Investment (BoI) said last month.