Asian Economy: Overview, Growth and Development.

Byline: S. Kamal Hayder Kazmi

The economy will continue to struggle, owing to the downside shock from the coronavirus outbreak and potential delays to the disbursement of fiscal stimulus.

Growth of 2.4 percent in 2019 was already the slowest in five years, significantly lower than the 4.1 percent expansion in 2018. The National Economic and Social Development Council has lowered its 2020 forecast to a range of 1.5-2.5 percent from 2.7-3.7 percent earlier.

We view the Thai economy as one of the most vulnerable in Asia to the impact of the coronavirus, and our GDP growth forecast of 2 percent comes with risks to the downside.

In 2019, a weak external backdrop was compounded by a loss of export competitiveness due to the strength of the baht, while the delayed passage of the budget while the new government was formed proved a major drag on the economy.

The economy was also affected by drought conditions that hit the agricultural sector, which accounts for about 8 percent of output. This exposed the already weak fundamentals of highly indebted households and domestic firms choosing to invest abroad rather than domestically.

Thailand's tourism industry is set to face significant challenges as a result of the coronavirus outbreak. Tourism receipts account for 13-14 percent of the economy, and the sector provides about one in six jobs. The Chinese government's suspension of international...