Thailand Growth Rate Unperturbed By Recent Bombing Attacks

According to the estimates of National Economic and Social Development Board (NESDB) the recent bombings and arson attacks in several southern resorts are not likely to affect Thailand’s growth rate. Paramethi Wimonsiri, the secretary-general of NESDB is positive that Thailand’s GDP will register a 3.3% increase for 2016.

The growth rate for the 2nd quarter of 2016 registered at 3.5% and has driven the economy for the 1st half of the year. Because of the increase in household spending as proven by the expansion of car sales, growth rate expanded by 3.4%. According to Deputy Prime Minister Somkid Jatusripitak, it is very unlikely for the blasts to create a strong impact on GDP however; people are still advised to remain calm on the bombings.

Both policymakers and economists believe that the bombing episodes will have short term effect on Thailand’s economy. In August 2015, the bomb attack on Erawan Shrine in Bangkok failed to drive away tourists. Instead, Thailand’s visitors grew by 20% to 30 million travelers. Tourist spending also grew by 25% over the same period and the country continues to be a key tourist destination for global travelers.

Based on data from WTTC, travel and tourism in Thailand have contributed 2.8 trillion baht (US$81.6 billion) in 2015 which is about 21% of the GDP. The tourism sector was also responsible for the creation of 6 million jobs which is 5% of the nation’s employment.

The wave of attacks that hit Hua Hin and the island of Phuket is one of the biggest challenges faced by the tourism industry. However, the industry has bounced back after more than a decade of political instability. The private sector is confident that the effects will only for short term after international terrorism has been ruled out. Since it is a domestic affair, the country can return to peace and order very quickly.

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