State agency lifts GDP forecast to 2.2%

Outlook assumes lenient US tariffs

- WICHIT CHANTANUSORNSIRI NAREERAT WIRIYAPONG

The Fiscal Policy Office (FPO) under the Finance Ministry has slightly increased its Thai GDP growth forecast for this year to 2.2%, up from its previous estimate of 2.1% in April.

The upgrade is based on the assumption that US reciprocal tariffs will remain at lenient rates, in line with those applied to other countries in the region, said Pornchai Thiraveja, director-general of the FPO.

Mr Pornchai said the forecast aligns with the International Monetary Fund’s (IMF) global economic outlook, which projected on July 29 global growth of 3% this year. The IMF also upgraded Thailand’s economic growth forecast to 2% from 1.8%.

The FPO did not specify what reciprocal tariff rate Thailand is likely to receive, but it is expected to fall within a range of 15-36%.

“The proposal we've submitted to the US is a good one and beneficial to both countries. The rate Thailand will receive should be in line with those already granted to other countries by the US,” he said.

Mr Pornchai said the IMF's upgrade of its global growth projection to 3% from 2.8% assumes reciprocal tariffs will not reach their ceilings.

The FPO assumed among Thailand’s 15 key trading partners, countries that have not reached an agreement with the US before July 29 would be able to negotiate and reach a deal by the third quarter. Under this assumption, reciprocal tariffs would be halved from the levels initially set by the US, but not fall below 15%.

He said the latest Thai economic forecast is driven by three factors: exports, manufacturing production and domestic private consumption.