BANGKOK, Sep 30 (Businesshala) – Thailand has good financial and financial stability, but its economy remains fragile and has limited ability to withstand shocks due to high external dependence amid a severe COVID-19 outbreak, the country’s central bank said. said on Thursday.
The Southeast Asian country is dealing with its worst-ever coronavirus outbreak, with the vital tourism sector still struggling. The economy suffered a 6.1% contraction last year and the central bank predicted a growth of just 0.7% this year.
Thailand’s financial stability, the stability of financial institutions and the strength of its balance of payments are “quite good”, Bank of Thailand Governor Sethaput Suthivartanruput said at a symposium on Thursday.
Despite macro measures indicating the economy is stable, “the Thai economy is not resilient and very fragile,” he said, adding that sustainability now needs to include issues other than economic factors such as social and environmental factors. will be required.
To be resilient, Thailand must have the ability to withstand and recover from shocks, Sethaput said.
“But we currently have limitations in every aspect that do not make the Thai economy resilient to the challenges,” he said.
He said the economic structure is heavily dependent on foreign countries, including tourism, exports and technology, as well as an increasing reliance on foreign workers due to an aging society.
Sethaput said the economy has limited ability to cope with changes due to high inequality and a large informal sector.
Vulnerable families and businesses are often affected by drastic changes, especially loss of income that creates economic “scars” that will take a long time to recover and prevent overall economic recovery, he said.