Thailand's Economic Growth Projected at 2.9% in 2025, Driven by Investment and Tourism Recovery

The World Bank highlights that fostering innovation, entrepreneurship, and supporting small and medium-sized enterprises (SMEs) are crucial for sustaining long-term growth.

Thailand's economy is forecast to expand by 2.9% in 2025, up from 2.6% in 2024, according to the latest Thailand Economic Monitor released today. This growth is primarily fueled by a rebound in investment, supported by higher budget execution and major infrastructure projects. Additionally, tourism is expected to return to pre-pandemic levels by mid-2025, further boosting private consumption and economic activity.

The World Bank highlights that fostering innovation, and entrepreneurship, and supporting small and medium-sized enterprises (SMEs) are crucial for sustaining long-term growth. SMEs, which constitute over 90% of Thai businesses and employ a large portion of the workforce, face significant barriers to finance, technology, and international markets. Addressing these challenges could enable SMEs to drive more dynamic economic expansion.

The government's 10,000-baht cash transfer program contributed to reducing the poverty rate to 8.2% in 2024 from 8.5% in 2023. Despite surpassing growth projections, Thailand's GDP remains below its potential, constrained by high household debt, sluggish private investment, and fiscal pressures from climate change adaptation and an ageing population.

To strengthen fiscal resilience, the World Bank advises Thailand to expand its tax base, improve revenue collection, and prioritize pro-growth investments in technology and infrastructure. Additionally, advancing digital skills and entrepreneurship through education and training programs will help empower the workforce and promote innovation.

Cristian Quijada Torres, World Bank Senior Private Sector Specialist, emphasized, "Empowering SMEs and startups with the right tools, financing, and skills is key to unlocking Thailand's potential for long-term, inclusive growth."

The report concludes that Thailand can enhance its global competitiveness by improving regulatory frameworks for trade and investment, expanding financial support for digital startups, and participating more actively in regional and global value chains.