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The Thai economy has recorded its slowest growth in nearly five years in the second quarter, the government said on Monday, as the slowdown in exports, the weakness of the agricultural sector and rising trade tensions between China and China have harmed the second largest economy in Southeast Asia.
Gross Domestic Product grew 2.3 percent from April to June compared with the same period in 2018, according to the Office of the National Economic and Social Development Council of Thailand, after a 2.9 percent increase in the first quarter of this year.
The Thai government has blamed the slowdown in domestic demand and the decline in export performance, the announcement of the announcement Tuesday by the government of a $ 10 billion economic stimulus package.
The Thai baht is one of Asia's best performing currencies this year, affecting the competitiveness of its exports and its key tourism sector, which generates more than a fifth of GDP. Its agricultural sector is in the grip of a drought.
Thailand said Monday that second-quarter agricultural production fell 1.1 percent, exports by 6.1 percent and imports 2.7 percent.
Veerathai Santiprabhob, governor of the central bank of Thailand, said Monday that the bank would lower its economic forecast for 2011 by 3.3% in 2019 due to slower growth. The Thai economy grew by 4.1% in 2018.
Earlier this month, the Bank of Thailand unexpectedly lowered the main lending rate by a quarter of a point, amid concerns over the bleak outlook for the Thai economy and world trade.
"The steady decline in export growth has been reflected in the growth of domestic demand," Nomura said in a research note. The Japanese bank, which expects 3% growth for Thailand this year, said that given the heightened uncertainty surrounding the US-China trade talks and the drought that has affected the agricultural sector, "we We believe that the balance of risks weighing on our forecasts remains downward.
Thailand is the last Asian country to report slowing economic growth. In the second quarter, Singapore and Hong Kong both posted their worst quarterly GDP in more than a decade, with economists predicting that the two countries would go into recession later in 2019.
Government spending, announced widely on Tuesday, is expected to rise to Btl 316 billion ($ 10 billion) and will help boost growth. It should include loans and debt relief for farmers, cash rebates for the poorest Thais and a visa moratorium for visitors from China and India, government officials said.
The number of tourist arrivals in Thailand increased by less than 2% in the first half of this year and the number of visitors from China decreased by almost 5%.
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