Bangkok (VNA) - The Thai economy may fare better than expected, helped by recovering domestic consumption and exports, according to the Fiscal Policy Office (FPO).

Kulaya Tantitemit, acting director-general of FPO said that the Thai economy should contract less than the 7.7 percent the office projected in October because economic conditions are improving, as indicated by the GDP in the third quarter.

Thailand's GDP contracted by 6.4 percent year-on-year in the third quarter following a 1.8 percent decline and a 12.1 percent contraction in the first and second quarters, respectively. After a seasonal adjustment, the economy expanded by 6.5 percent quarter-on-quarter in the July-to-September period from the second quarter. In the first nine months, the economy contracted by 6.7 percent.

The improvement was attributed to the easing of lockdown measures and domestic travel restrictions, coupled with measures to rehabilitate the economy through fiscal stimulus.

Full-year GDP contraction was forecast at 7.7 percent this year by the FPO, with growth of 4.5 percent projected for next year.

Kulaya said domestic consumption is the key driver for Thailand's economic performance this year, while exports shrunk because of the pandemic.

Anusorn Tamajai, former dean at Rangsit University’s Faculty of Economics, estimated that the second wave of COVID infections would cost the local tourism industry about 16 billion baht (530 million USD) in loss during the New Year holidays.

National Economic and Social Development Council (NESDC) forecasts that the Thai economy will grow by up to 4.5 percent in 2021./.