(Bangkok, 24th Thailand) The National Economic and Social Development Council (NESDC) of Thailand, amidst a highly uncertain environment, has maintained its 2026 economic growth forecast for Thailand at 1.5% to 2.5%, with a median of 2%.
Although the Thai economy grew by 2.8% in the first quarter of this year, higher than the 2.5% in the fourth quarter of last year, the economic outlook for the remainder of 2026 remains highly uncertain.
Finance Minister Ekniti Nitithanprapas stated that the first quarter economic performance was satisfactory, especially with total investment growing by 9.9%, and private investment expanding by more than 10.1%.
Exports also continue to demonstrate strong momentum.
However, as rising oil prices drive the gradual adjustment of commodity prices, the economy is expected to face inflationary pressures in the future.
The global economy also faces risks, with long-term government bond yields rising significantly in many countries, especially the United States. There are market concerns that after a sharp surge in oil prices, inflation may heat up again.
Domestically, the economy will start to face a “cost of living crisis” triggered by increased commodity prices. This may lead to business closures and reduced employment.
To mitigate these risks, the Thai government has launched the “Thai Chuai Thai Plus” assistance program to ease the living burden for the people.
NESDC Secretary-General Danucha Pichayanan said that for the remainder of this year, especially in the second half, the economic outlook remains highly uncertain, as the current crisis stems from the situation in the Middle East.
The outcome of the conflict between the US, Iran, and Israel remains unpredictable, and widespread damage to energy infrastructure means oil and energy prices may remain high for a considerable time.
In this year’s highly volatile economic environment, the NESDC pointed out that there are currently four major economic risks that need attention, and the government should prioritize six key issues in economic management.
The key information is as follows:
Middle East Geopolitical Crisis
The prolonged conflict has affected energy production and Hormuz Strait transport, causing the average price of Dubai crude oil to rise to $117.2 per barrel during March to April, far higher than $67.5 before the incident. This situation pushed up the Producer Price Index (PPI) by 9.1% in April and increased costs of key raw materials such as naphtha, ethane, and urea fertilizer, which will further raise agricultural production costs in the future.
Global Economic Slowdown & Financial Market Volatility
Attention must be paid to US trade barriers, especially since the US may reimpose high import tariffs on China after November 10, 2026. Furthermore, if inflation heats up again, a prolonged high interest rate policy may persist globally. At the same time, China’s economic weakness and the risk of Hantavirus spread could also impact tourism and export performance.
Household Debt and SME Loan Quality Issues
As financial institutions tighten lending, the household debt-to-GDP ratio rose again in the fourth quarter of 2025, becoming a major drag on the recovery of domestic demand and a constraint on this year’s economic growth.
Climate Fluctuation Risks
Although the current reservoir water level is 20.3% higher than the five-year average, it is expected that an El Niño phenomenon will occur in the second half of 2026, with severe drought potentially affecting the output of key crops such as rice, cassava, and corn, impacting farmers’ incomes.
Six Key Economic Management Plans for the Second Half
To ensure Thailand’s continued stable economic progress, NESDC recommends that the government prioritize the following six macroeconomic policies:
1. Strengthen Energy Security
Ensure energy supply by building diversified reserve sources, launch targeted aid for highly energy-dependent sectors such as transportation, fisheries, and construction, and accelerate clean energy transition via Direct PPA and Smart Grid systems.
2. Accelerate Private Investment
Improve investment facilitation through the “Thailand FastPass” system, resolve investment barriers—especially in new technology sectors like AI and robotics—and encourage SMEs to integrate into global supply chains.
3. Promote Export Growth
Proactively respond to EU environmental measures such as the CBAM and EUDR, and expedite FTA negotiations with the EU, South Korea, Pakistan, and Turkey to diversify market risks.
4. Maintain Fiscal Discipline
Ensure that the 2026 fiscal year budget disbursement rate reaches at least 90.7%, with at least a 70% disbursement rate for investment budgets, and effectively manage a 400-billion-baht loan facility to address the energy crisis and preserve future fiscal space.
5. Aid Drought-Affected Farmers
Quickly seek alternative sources of fertilizer raw materials to reduce reliance on Middle Eastern supplies, and pre-deploy “super El Niño” response measures to ensure sufficient water for the new planting season.
6. Improve Financing and Debt Issues
Assist small-amount borrowers with debt restructuring through “Quick Debt Resolution, Fresh Start” measures, and perfect the household debt database to support long-term sustainable debt solutions.
Although the Thai economy grew by 2.8% in the first quarter of this year, higher than the 2.5% in the fourth quarter of last year, the economic outlook for the remainder of 2026 remains highly uncertain.
Finance Minister Ekniti Nitithanprapas stated that the first quarter economic performance was satisfactory, especially with total investment growing by 9.9%, and private investment expanding by more than 10.1%.
Exports also continue to demonstrate strong momentum.
However, as rising oil prices drive the gradual adjustment of commodity prices, the economy is expected to face inflationary pressures in the future.
The global economy also faces risks, with long-term government bond yields rising significantly in many countries, especially the United States. There are market concerns that after a sharp surge in oil prices, inflation may heat up again.
Domestically, the economy will start to face a “cost of living crisis” triggered by increased commodity prices. This may lead to business closures and reduced employment.
To mitigate these risks, the Thai government has launched the “Thai Chuai Thai Plus” assistance program to ease the living burden for the people.
NESDC Secretary-General Danucha Pichayanan said that for the remainder of this year, especially in the second half, the economic outlook remains highly uncertain, as the current crisis stems from the situation in the Middle East.
The outcome of the conflict between the US, Iran, and Israel remains unpredictable, and widespread damage to energy infrastructure means oil and energy prices may remain high for a considerable time.
In this year’s highly volatile economic environment, the NESDC pointed out that there are currently four major economic risks that need attention, and the government should prioritize six key issues in economic management.
The key information is as follows:
The prolonged conflict has affected energy production and Hormuz Strait transport, causing the average price of Dubai crude oil to rise to $117.2 per barrel during March to April, far higher than $67.5 before the incident. This situation pushed up the Producer Price Index (PPI) by 9.1% in April and increased costs of key raw materials such as naphtha, ethane, and urea fertilizer, which will further raise agricultural production costs in the future.
Global Economic Slowdown & Financial Market Volatility
Attention must be paid to US trade barriers, especially since the US may reimpose high import tariffs on China after November 10, 2026. Furthermore, if inflation heats up again, a prolonged high interest rate policy may persist globally. At the same time, China’s economic weakness and the risk of Hantavirus spread could also impact tourism and export performance.
Household Debt and SME Loan Quality Issues
As financial institutions tighten lending, the household debt-to-GDP ratio rose again in the fourth quarter of 2025, becoming a major drag on the recovery of domestic demand and a constraint on this year’s economic growth.
Climate Fluctuation Risks
Although the current reservoir water level is 20.3% higher than the five-year average, it is expected that an El Niño phenomenon will occur in the second half of 2026, with severe drought potentially affecting the output of key crops such as rice, cassava, and corn, impacting farmers’ incomes.
Six Key Economic Management Plans for the Second Half
To ensure Thailand’s continued stable economic progress, NESDC recommends that the government prioritize the following six macroeconomic policies:
1. Strengthen Energy Security
Ensure energy supply by building diversified reserve sources, launch targeted aid for highly energy-dependent sectors such as transportation, fisheries, and construction, and accelerate clean energy transition via Direct PPA and Smart Grid systems.
2. Accelerate Private Investment
Improve investment facilitation through the “Thailand FastPass” system, resolve investment barriers—especially in new technology sectors like AI and robotics—and encourage SMEs to integrate into global supply chains.
3. Promote Export Growth
Proactively respond to EU environmental measures such as the CBAM and EUDR, and expedite FTA negotiations with the EU, South Korea, Pakistan, and Turkey to diversify market risks.
4. Maintain Fiscal Discipline
Ensure that the 2026 fiscal year budget disbursement rate reaches at least 90.7%, with at least a 70% disbursement rate for investment budgets, and effectively manage a 400-billion-baht loan facility to address the energy crisis and preserve future fiscal space.
5. Aid Drought-Affected Farmers
Quickly seek alternative sources of fertilizer raw materials to reduce reliance on Middle Eastern supplies, and pre-deploy “super El Niño” response measures to ensure sufficient water for the new planting season.
6. Improve Financing and Debt Issues
Assist small-amount borrowers with debt restructuring through “Quick Debt Resolution, Fresh Start” measures, and perfect the household debt database to support long-term sustainable debt solutions.