News Analysis: Thailand faces tightrope walk to rebooting economic growth

22-Jan-2021 Intellasia | Xinhua | 6:02 AM Print This Post

As the COVID-19 pandemic has continued to spread in Thailand, the government is walking a tightrope trying to strike a balance between pandemic containment and easing economic pains from a resurgence of the virus.

After managing to keep the pandemic largely in check for most of last year, Thailand found itself suddenly mired in an expanding outbreak which has spread to 62 of its 77 provinces.

As of Wednesday, the total caseload has increased to 12,653, with more than 8,000 of the infections reported since mid-December.

The World Bank warned that the Thai economic outlook remains highly uncertain due to risks from external and domestic sources.

“If the new wave of infection in Thailand is not well contained, or if global cases continue to rise and progress on distributing a vaccine is slower than anticipated, economic activity could continue to be disrupted by social distancing measures and lockdowns,” it said in a report released Wednesday.

The bank expected the economy to contract 6.5 percent in 2020, but rebound to 4 percent in 2021 and pick up further to 4.7 percent in 2022.

For the sake of economic recovery, the Thai government has been restrained from imposing a national lockdown, which slammed the brakes on exponentially growing virus outbreaks last year but brought the country’s economy into a standstill.

The government, instead, applied restrictive measures according to risk levels and caseloads. It also conducted active testing to trace the virus and secured vaccine orders for national vaccination that is scheduled to start next month.

To aid individuals and businesses affected by the pandemic, the government unveiled a package of stimulus measures, including 22.4 billion-baht (about 746.8 million US dollars) support plans for the ailing tourism sector, lower electricity and water bills for households and a monthly handout of 3,500 baht per person for low-income earners during February-March period.

The Bank of Thailand, the central bank, said although coronavirus in the latest outbreak spread faster than in last year, the economic impacts would be milder as the government has been imposing more flexible restrictive measures, with fewer businesses being suspended.

Drawing lessons from last year, the Thai government is trying to find a balance between curbing the pandemic and saving the economy, showing more flexibility on restrictive measures, said Tang Zhimin, director of China Asean Studies in the Bangkok-based Panyapiwat Institute of Management.

Tang said the Thai economy was already weakening prior to the COVID-19 outbreak because of diminishing cost advantages in labour compared with countries such as Vietnam and Indonesia as well as challenging development in industrial upgrading.

To reboot growth, he advised the Thai government to further enhance economic and trade cooperation with China under the Belt and Road Initiative, China-Asean dialogue relations and the Regional Comprehensive Economic Partnership. (1 US dollar equals 30 Baht).

http://www.xinhuanet.com/english/2021-01/20/c_139684684.htm

 

Category: Thailand

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