Bangkok: Thailand’s economy has become accustomed to low growth, and the new government must urgently address the liquidity issue. Although the election is over, political uncertainty remains a key variable affecting economic confidence. The private sector is watching closely to see how quickly the new government can restore stability, as political volatility has been one of the main factors hindering Thailand’s consistently low GDP growth for almost two decades.
According to Thai News Agency, Dr. Thanit Sorat stated that Thailand’s low economic growth has become the “new normal,” averaging only about 2% per year after COVID-19. He likened it to “being accustomed to not being full,” meaning that consistently low growth has led society to become desensitized to figures that don’t reflect the country’s true potential. The economic team needs to be professional and address the issues directly.
What the private sector values most is not just who leads the government, but the “economic team” itself, which must be professional, understand structural problems, and be able to solve them effectively, especially the liquidity problem in the system. Currently, private consumption, which accounts for over 60% of GDP, is experiencing low growth, credit is contracting continuously, and household debt burdens are weakening purchasing power. A large portion of income is being used to pay interest and debt, impacting the grassroots economy, from shops and markets to shopping malls.
Dr. Thanit believes that resolving debt and financial restructuring issues requires financial and banking experts to join the economic team in order to develop more effective measures than simply providing short-term relief. Economic stimulus measures should be implemented simultaneously in all three areas: tourism, exports, and investment.
Although exports grew well last year due to accelerated US orders prior to tariffs, the outlook for this year may not be as bright. The 19% US import tariff remains a key issue requiring urgent negotiation. At the same time, concerns remain regarding the proportion of domestically produced goods (local content) and the issue of Chinese goods fraudulently passing through free trade zones, which could negatively impact long-term trade relations.
From the perspective of small business owners, the government should implement proactive support measures, such as co-payment schemes to cover the costs of participating in international trade shows, in order to open up opportunities to expand into new markets. Another worrying issue is the relationship with Cambodia, which has a border trade value of over 100 billion baht annually. Border closures or prolonged tensions would not only affect exports but also undermine the confidence of foreign investors and tourists.
In an increasingly complex geopolitical world, Thailand needs to carefully maintain a diplomatic balance, as its economy is more dependent on international trade and investment than many other countries in the region. The Thai economy today is not in a state of sudden crisis, but is facing a “structural crisis” that has accumulated over a long period. The important question, therefore, is not just how much GDP will grow this year.
But the question is, will the new government be able to unlock liquidity problems, restore confidence, and enhance long-term growth potential? Because if we continue to “get used to never being full,” Thailand may be so accustomed to low growth that it has forgotten its true potential.