Thailand’s economy expected to grow up to 3.5% in 2015 – World Bank

Raising Export Competitiveness and Improving Education Quality Are Key Priorities

BANGKOK, June 3, 2015— The Thai economy grew by 0.9 percent in 2014, as domestic demand was dampened by political turmoil in the first half of the year and exports fell amid lower demand from China and other large Southeast Asian countries, according to the Thailand Economic Monitor 2015, released today by the World Bank Group.

The country’s real GDP is expected to increase by up to 3.5 percent in 2015, primarily due to lower oil prices, increased tourism receipts, and higher public spending. Thai exports are expected to continue growing slowly. 

The report traces slowing export growth since 2012 in part to an erosion in Thailand’s competitiveness. Exports on average grew 13 percent per year from 2006 – 2011, before slowing to less than 1 percent from 2012-2014. Thailand’s market share in world exports has declined correspondingly in this same period.

“Thailand has seen high growth in the past. Further improvements in competitiveness will be important for sustained economic growth and rising incomes for the Thai people,” said Ulrich Zachau, World Bank Country Director for Southeast Asia. “Helping ensure that all Thais can enjoy a high quality education and acquire strong skills for the modern economy will be the key for increasing productivity and competitiveness. Organizing school networks so as to place good teachers in all class rooms throughout Thailand can make a big difference for Thai children and families, especially outside Bangkok," he added.

"This issue of the Thailand Economic Monitor stresses the urgent need to develop our human resources, on which I cannot agree more,” said H.E. Sommai Phasee Thailand Minister of Finance. “Education is the key to improving a country's competitiveness. Countries that have given importance to this issue, such as Singapore and South Korea, have been able to rapidly transition from middle income countries to developed countries. I would therefore urge all to read this report and stimulate actions to further develop our education system."

The World Bank report notes that raising the skills and productivity of the labor force are central to improving Thailand’s competitiveness, and identifies education reform as a priority. Thailand has made great progress in expanding basic education and improving attendance in both urban and rural schools. Virtually all Thai children today attend primary school, and 70 percent of poor families are able to send their children on to secondary school compared to only 10 percent 25 years ago. 

Still, more can be done to provide a quality education for all of Thailand’s students and maximize their potential in joining Thailand’s increasingly skilled workforce. Organizing networks of smaller rural schools, for example, can optimize the effectiveness of good teachers, bringing better teaching to all classrooms and giving a better education to all students and reduce the disparity in education results between urban and rural schools.