BANGKOK, March 31 (Xinhua) -- The World Bank expected Thailand's economy to grow 3.6 percent year on year in 2023, accelerating from 2.6 percent in 2022, supported by domestic consumption, tourism recovery and pent-up demand in China.
The faster growth will come from stronger domestic private consumption and revival of tourism, the World Bank East Asia and Pacific Chief Economist Aaditya Mattoo said at a virtual press conference Friday, when the bank released its latest East Asia and the Pacific Economic Update report.
Thailand's tourist arrivals are projected to increase to 27 million in 2023, reaching 68 percent of the pre-pandemic level, and are expected to accelerate and surpass the pre-pandemic level by 2024, according to the bank.
However, Thailand's goods exports in U.S. dollar-denominated terms are expected to contract in 2023, due to slowing global growth, Mattoo said.
Mattoo said though the Southeast Asian country's inflation remains higher than the target range, the inflation pressures have eased.
He warned about domestic challenges such as rising household debt levels, rapid aging, low capital investment accumulation and declining export competitiveness, which may limit Thailand's potential growth, and advised deepening reforms, especially in the service sector.
To ensure sustainable development, Kiatipong Ariyapruchya, the World Bank's senior economist for Thailand, said besides maintaining fiscal stability and sustainability, Thailand must further open up the service sector, increase investment for climate adaptation and enhance social protection for the aged and poor.
In the latest East Asia and the Pacific Economic Update, the World Bank said economic performance across the region, while robust, could be held back this year by slowing global growth, elevated commodity prices and tightening financial conditions.
The bank expected growth in East Asia and the Pacific region to accelerate to 5.1 percent in 2023 from 3.5 percent in 2022, according to the report.
Looking forward, the World Bank urged the region to implement structural, macro-financial and climate-related reforms to address the problems of slowing productivity growth and scars from the pandemic, even as it faces up to the major challenges of deglobalization, aging and climate change.