Bangkok (VNA) – Thailand’s National Economic and Social Development Council (NESDC) has urged the government to facilitate the country’s transition to high-tech industries to attract investors as the second largest economy in the Southeast Asia is lagging behind others in the region in terms of growth rate and foreign direct investment (FDI) attraction.
In the economic outlook report for the first quarter of 2024 published recently, the NESDC revealed that Thailand’s gross domestic product (GDP) grew by 1.5% in the first quarter, the lowest among members of the Association of Southeast Asian Nations (ASEAN).
It noted that Thailand was in the last place on the list of 2023 FDI flows into ASEAN, with total investment of 2.96 billion USD. Indonesia topped the list with 21.7 billion USD, followed by Malaysia 18.5 billion USD and Vietnam 8.25 billion USD.
The NESDC said that Thailand’s FDI showed a downward trend throughout 2023, with significant drops in traditional industries such as petroleum for the first time in three years.
The council held that the industries that have been driving the Thai economy in the past have started to play a diminishing role in the manufacturing and export sectors. The declining FDI affected the country’s exports, which contracted 1% in the first quarter of 2024, while the Manufacturing Production Index also went down by 3.7%, falling for six consecutive quarters, it continued.
Despite increases of 6.9% in private consumption and the service sector, 2.5% in exports and 4.6% in private investment, the NESDC has lowered its annual GDP growth projection from 2.2 - 3.2% to 2 - 3%, citing risks from the ongoing US - China trade war and geopolitical conflicts.
The council advised the government to offer incentives and promote manufacturers to upgrade production technology towards innovative and advanced technology products. Priority should be given to industries related to raw material production and intermediate goods within the country, as well as to training skilled labour to meet the needs of targeted industries./.
