Thailand’s economy shrunk by as much as 12.2 per cent during the second quarter of 2020, a government think-tank, the National Economic and Social Development Council (NESDC) announced Monday.
The gross domestic product (GDP) during the second quarter was down by 12.20 per cent against the expectations of a -13 to -17 per cent shrinkage that was expected in the market.
The NEDSC, which announces the data each quarter, said that for the year it was expecting the GDP to shrink by as much as -7.3 to -7.8 from the earlier projection of -5 to -6 per cent.
The NESDC predictions are lower than the Bank of Thailand (BOT) which has projected that the Thai economy will shrink by as much as -8.3 per cent during the course of 2020 as exports and tourism, which account for nearly 70-80 per cent of the GDP, has seen a sharp decline.
Tourism, which accounts for about 17-18 per cent of the GDP, has seen zero foreign tourist arrivals as the country’s airspace has remained shut since late March as a result of the coronavirus pandemic.
Meanwhile, the global slowdown due to the coronavirus has slowed the exports of the country and the monthly figures announced by the various authorities has shown that the exports have been declining in double digits.
Exports account for about 60 per cent of the GDP of Thailand.
The fall in tourism numbers has hurt the economy as millions of tourism-related jobs have been lost and small and medium-sized industries are suffering.
It is expected that a bulk of the impact from the fall in tourism numbers would be felt during the 3rd and 4th quarter when the various incentives offered by the government are set to expire and businesses are set to suffer major setbacks amid loss of revenue.
Malaysia and Singapore
Consequently, the widespread impact of COVID- 19 has caused economic recession across all ASEAN countries.
Malaysia’s economy contracted 17.1 per cent in the second quarter this year as it was seriously impacted by the movement control orders.
The Statistics Department of Malaysia said the second quarter performance was the lowest recorded since the Asian Financial Crisis in 1998 (-11.2 per cent).
Singapore economy also contracted by 12.6 per cent on a year-on-year basis in the second quarter of 2020, due to the Circuit Breaker (CB) measures implemented to slow the spread of COVID-19, which included the suspension of nonessential services and workplace closure.
On a quarter-on-quarter basis, the Singapore economy saw a decline of 41.2 per cent in the second quarter.
