BANGKOK (Reuters) - Thailand’s economy in the January-March period may have expanded at its fastest pace in four years from the previous three months, as stronger exports, consumption and tourist numbers more than offset weaker private investment and public spending.
Growth in Southeast Asia’s second-largest economy has still lagged regional peers since 2014, when the military seized power to end months of street protests.
The junta has ramped up investment to lift activity but big infrastructure projects have been slow getting off the ground.
Pivotal exports are recovering after years of weakness, but Thailand faces global trade protectionism and risks of fund outflows as the Federal Reserve plans more rate hikes this year.
In a Reuters poll, gross domestic product (GDP) is expected to have expanded a seasonally-adjusted 1.2 percent in the March quarter from the prior three months, when growth was 0.4 percent. If realized, it would be the best pace since the final quarter of 2012.
From a year earlier, growth was forecast to be slightly faster at 3.2 percent in January-March, after 3.0 percent in the previous quarter.
For 2017, growth is expected at 3.3 percent, up from 3.2 percent in 2016, the poll showed.
The National Economic and Social Development Board, which compiles GDP data, has forecast 2017 GDP growth of 3.0-4.0 percent and export growth of 2.9 percent. It will give new projections on Monday.
“We are optimistic on Thailand’s external environment. First quarter trade prints are exceptionally good,” said Barnabas Gan, economist of OCBC Bank in Singapore, adding he had raised his 2017 GDP growth outlook to 3.5 percent from 3.2 percent.
Strength in farm income and improving private sector confidence will reinforce the economic recovery momentum, said Sarun Sunansathaporn, senior economist of Bank of Ayudhya.
In January-March, exports grew 6.6 percent from a year earlier while private consumption expanded 2.9 percent and farm income jumped 20 percent, central bank data showed. Exports are worth about two-thirds of Thailand’s economy.
Tourist numbers rose to 9.2 million in the first quarter from 7.8 million in the December quarter, when a Thai crackdown on cheap tour packages slashed the number of visitors from China and some activities were cut back after the death of King Bhumibol Adulyadej in October.
Private investment contracted 2.2 percent in the March quarter year-on-year while government expenditure declined 4 percent.
Editing by Jacqueline Wong