Thailand

Buoyed by a rise in consumer spending, Thailand narrowly avoided a technical recession thanks to a surprise upswing in the second quarter. The new government is hoping this shift, combined with its own plans to increase public spending across key sectors, will help entice investors.

A return to economic growth in Thailand is expected to drive greater demand for electricity, hastening efforts to look for alternative sources of energy, although continued political uncertainty could slow public investments in power plants and transmission lines.

While Thailand is pushing ahead with efforts to expand its network of free trade agreements (FTAs), the lack of a permanent government means that approval and implementation of any deals could be delayed.

Over the past 12 months Thailand’s economy has come under growing pressure, with political unrest combining with falling industrial output and weakening exports to slow development and cool investor confidence.

Lenders in Thailand are expected to adopt a cautious position in the coming months, keeping a close watch on household debt levels and monitoring the local economy’s return to growth following a contraction earlier this year.

Energy consumption in Thailand is set to jump by 75% over the coming two decades as the economy expands and a more affluent society takes to the roads in increasing numbers, according to a new report. However, this new growth and mobility will come at a cost, with dependence on oil imports set to rise and increasing susceptibility to external price shocks.