Thailand revises down 2022 growth project

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UTCC President Asst. Prof. Dr. Thanavath Phonvichai said the Thai economy is now expected to expand in the range of 2.3-3.5%, or an average of 3.1% while the revised projection is lower than the 4.2% forecast issued at the end of 2021.

The University of the Thai Chamber of Commerce (UTCC) has revised its projection for Thai GDP growth in 2022 to 3.1%, down from 4.2%. In its revised assessment, the UTCC cited rising domestic fuel prices and diminished growth trends for the U.S. and Chinese economies.



UTCC President Asst. Prof. Dr. Thanavath Phonvichai said the Thai economy is now expected to expand in the range of 2.3-3.5%, or an average of 3.1%. The revised projection is lower than the 4.2% forecast issued at the end of 2021. The new figure is also based on a projected growth of 2.9% for the global economy, an average Dubai crude rate of US$110 per barrel, and an exchange rate of 34.25 baht to the U.S. dollar. Policy interest rates are also expected to be raised twice this year from 0.5% currently.



Exports are now expected to grow 6.3% instead of 5.3%. Dr. Thanavath, who is also chief advisor to the UTCC’s Center for Economic and Business Forecasting (CEBF), attributed this adjustment to the baht’s depreciation. He noted that this has boosted the export value of several items, especially agricultural commodities, latex and food.


According to Dr. Thanavath, a less desirable scenario for GDP growth involves raising diesel pump prices to just under 40 baht per liter. It also involves three policy interest hikes in increments of 0.25% instead of two. In this scenario, Thailand’s GDP would grow by 2.9%.

The UTCC president said an even bleaker scenario involves sharply raised U.S. policy rates amid the ongoing Russia-Ukraine conflict. In such an event, global oil prices could reach as high as $140 USD per barrel, with the worldwide economic slowdown impacting Thai exports. He added that GDP would only grow by 2.3% under this scenario, but stressed that this was unlikely. (NNT)