BANGKOK: Thailand’s economic growth slowed in the third quarter, data showed Monday, with fears of further pain to come in a nation plunged into mourning following the death of its long-serving King Bhumibol Adulyadej.
High household debt, weakening exports, slumping foreign investment and low consumer confidence have cramped growth in what for years was Southeast Asia’s flagship economy.
A military junta seized power in 2014 vowing to end years of political instability and kickstart the lackluster economy.
The economy has since picked up slightly, mainly on the back of ramped-up government spending and tourist arrivals, but it remains comparatively low compared with its neighbors.
The National Economic and Social Development Board (NESDB) said Monday the economy expanded 3.2 percent on-year in July-September, missing estimates and also down from 3.5 percent in the previous quarter.
Seasonally adjusted quarter-on-quarter growth was 0.6 percent, down from a revised 0.7 percent in the three months prior.
The dip will do little to raise hopes of a final quarter bump for Thailand as it approaches peak tourist season.
King Bhumibol’s death on 13 October after a seven-decade reign has left politically divided Thailand without a rare pillar of unity.
The arch-royalist generals ordered an initial month-long mourning period where entertainment and festivities were either halted entirely or told to tone down. The official mourning period will last a full year.
Analysts said the king’s death would likely hit final quarter growth, particularly in the country’s entertainment sector, while political uncertainty will remain an issue.
“Although calm has prevailed since the death of the king last month, the political situation remains highly uncertain, and this will continue to hang over the outlook for private investment,” Krystal Tan, at Capital Economics said in a briefing note.
Somprawin Manprasert, chief economist at Bangkok-based Bank of Ayudhya, told Bloomberg News: “The economy may face challenges with slowing tourist arrivals and subdued mood during the king’s mourning period.”
The NESDB estimates 2016’s overall growth rate to be 3.2 percent, up from 2.8 percent last year.
Tourism remains one of the key brightspots with officials telling AFP last week the kingdom was still on track to receive a record 32 million overseas visitors by the end of the year.
Bhumibol’s dwindling health coincided with a decade of political turmoil, which began when the military toppled prime minister Thaksin Shinawatra in 2006.
Years of competing street protests, short-lived governments and outbreaks of violence have followed, culminating in another coup in 2014 that toppled the administration of Thaksin’s sister Yingluck.
Bhumibol’s named successor, Crown Prince Maha Vajiralongkorn, has yet to attain his father’s popularity or unifying status.
He has also yet to be officially proclaimed the new king after he made a surprise request for a period of reflection to mourn his father before any further succession steps, according to the junta.
Thailand’s rubber-stamp parliament, the body that proclaims any new king, is expected to next meet at the beginning of December, raising expectations that Vajiralongkorn’s proclamation is imminent. AFP