The overreliance on the international tourist arrivals by the Thai economy was exposed due to the pandemic as it brought a sudden stop on travelling internationally. Thailand had received almost 40 million tourist in 2019 and the tourism department had expected this figure to double by 2030.
After the imposition off as Thai government prioritized health and wellbeing of its citizens over their economic loss. A total of around 3,800 cases and only 59 deaths were recorded, as a result of the collective effort of the medical staff, government officials and the Thai people. Providers remained closed. During the first quarter there was a decrease in number of international tourists and in the second quarter there was even a lower number of tourists. With the absence of foreign tourists and a massive drop in exports there was a contraction of -12.2 percent for the second quarter. Because of the decision of the national lockdown, there was a collapse of consumer spending as hospitality service providers remained closed or were open only for take away services. After the second quarter, private consumption bounced back. A pickup in consumer spending was evident in both durables and non-durables over the third quarter and with recent fiscal stimulus aimed at boosting liquidity to the needy should be supported.
Thai government was expecting to have a double digit economic loss but to receding fear and rise of confidence of the pandemic, Thai GDP forecasted only -7.1 percent loss by the International Monetary Fund (IMF) in the second quarter.
Government handed out monetary reliefs to the ones affected severely, the ones in vulnerable segments such as farmers and the poo. More than 30 million people being in this state of condition received direct financial support from the government. A historic low of 0.50 percent was set as the policy rates which was three times lesser than earlier rates. The bank also issued a six month debt holiday for a time period of six months. These measures helped in providing liquidity backstop for businesses and private sectors.
The government decided to address the issues of income inequality as 30 percent of agricultural workforce accounted only for 6 percent of its GDP. Measures like proper waste-management systems to reduce floods and droughts were inculcated, helping farmers to grow more crops efficiently may be switching from rice and rubber to a higher value crops. Smart farming can help the country to fight economy and probably lift productivity for the sector significantly.
Using this opportunity Thailand should become a medical and wellness hub, promoting is to be a place to live and work. Improving its infrastructure within Eastern Economic Corridor with modernization, constructing economy should be the first and urgent priority that needs to propel Thailand into a new economic landscape.
Therefore, addressing and solving the key issues of farming, deregulating the lack of skilled labors can be the key to achieve a sustainable growth for the year and the coming decades too.