Thailand Sees 2020 GDP Drop 7.7%, Better Than Prior Forecast

(Bloomberg) -- Thailand's economy will shrink this year by less than previously estimated as government support measures alleviate the impact of the coronavirus pandemic, according to the finance ministry.

The Southeast Asian nation, which has seen trade and tourism battered by the pandemic, will contract 7.7% in 2020, Pornchai Thiraveja, a financial policy adviser and the ministry's deputy spokesman, said Thursday. The ministry in July had forecast an 8.5% drop.

The revised forecast still puts Thailand's economy on track for its worst performance ever, surpassing even the 7.6% contraction during the Asian financial crisis more than two decades ago. The ministry on Thursday also forecast 2021 gross domestic product to grow 4.5%.

Read more: Thai Economic Recovery Shaken as Protests Pose New Risks

The Thai economy is facing challenges from the Covid-19 outbreak and escalating political demonstrations, while Prime Minister Prayuth Chan-Ocha's government has unveiled a raft of measures to drive consumer spending. The forecasts released Thursday don't take into account the impact of the recent protests, Pornchai said.

“We stand ready to issue more stimulus measures if needed,” he said.

The Bank of Thailand last month also revised its economic forecast for the year, predicting a 7.8% contraction compared with a previous outlook for an 8.1% decline. The central bank's new governor, Sethaput Suthiwart-Narueput, said last week he's looking into new measures to boost the economy, which is expected to take at least two years to return to pre-pandemic levels.

Read more: Thailand's $74 Billion Borrowing Plan Seen Weathering Protests

Other forecasts provided Thursday include:

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