S-E Asia's roaring economies: Thailand

Tourism, exports brighten forecast

The hotel and restaurant sector in Thailand grew a steady 6.7 per cent in the third quarter, propelled by robust foreign and domestic tourism receipts, as well as higher hotel occupancy.
The hotel and restaurant sector in Thailand grew a steady 6.7 per cent in the third quarter, propelled by robust foreign and domestic tourism receipts, as well as higher hotel occupancy.PHOTO: EPA-EFE

The evening rays are just flooding into the Bangkok hotel lobby as a guest in T-shirt and bermudas walks past its sliding doors. Stacked high in his arms are gift boxes from luxury brands like Louis Vuitton and Burberry.

This is just another day for Modena by Fraser hotel, where leisure travellers make up 60 per cent of the guests.

"They walk around and try Thai food and, most importantly, shop - (for) both luxury products and Thai products. All the guests come to Thailand for shopping," its general manager Piyalak Penkunaporn told The Straits Times.

Occupancy at the one-year-old hotel grew 10 per cent in the July to September period over the preceding quarter, and is expected to grow by at least the same figure in its second year of operation, she said.

The hotel and restaurant sector in South-east Asia's second-biggest economy grew a steady 6.7 per cent in the third quarter, propelled by robust foreign and domestic tourism receipts, as well as higher hotel occupancy. The sector is one of the good performers in the Thai economy that helped push overall gross domestic product growth to a higher-than-expected 4.3 per cent in the July to September period.

Other star performers in the third quarter were exports, which grew 12.5 per cent in tandem with the economic expansion of trading partners and higher commodity prices in the world market.

Private consumption by Thailand's 68 million people grew 3.1 per cent in the third quarter, creeping up from 3 per cent in the preceding period.

The National Economic And Social Development Board expects the Thai economy to expand between 3.6 per cent and 4.6 per cent next year. But economists warn that the global economic outlook that is driving positive sentiments in Thailand could change.

Dr Benjarong Suwankiri from TMB Bank told ST: "Resurfacing political risks across the globe (in the European Union, Saudi Arabia, and United States) could hamper sentiments towards global economic growth."

Domestically, one big unknown is whether political conflict will arise after an election which Prime Minister Prayut Chan-o-cha has said would be held next November.

While economists expect public investment to rise next year, Mr Charnon Boonnuch from Tisco Economic Strategy Unit warns that there may be further delays if the major infrastructure projects are not started before the next election.

Private consumption by Thailand's 68 million people grew 3.1 per cent in the third quarter, creeping up from 3 per cent in the preceding period.

A version of this article appeared in the print edition of The Straits Times on November 27, 2017, with the headline 'Tourism, exports brighten forecast'. Print Edition | Subscribe