Recent protests in Thailand will be a “double whammy” for growth in the country, which has already suffered a blow from the Covid-19 pandemic, analysts say.
Furthermore, the protesters will not go away until they see a “new” Thailand, Thitinan Pongsudhirak, a professor at Chulalongkorn University, told CNBC on Friday.
“The rise in Thailand’s political temperature following the announcement of a state of emergency in Bangkok will deal a big blow to an economy already reeling under the impact of the pandemic,” Lavanya Venkateswaran, market economist at Mizuho Bank, wrote in a note.
Mizuho Bank lowered its 2020 GDP growth forecast for the Southeast Asian country from -6.3% to -7.5%.
“This time the social unrest brought on by decades of deep political division has been exacerbated by the COVID-19 pandemic,” Venkateswaran said, pointing out that the areas impacted by the political uncertainty are also the same ones hit by the pandemic. That includes weaker private sector spending on investment and consumption and a fallout from lower tourist arrivals. The Thai economy relies heavily on tourism for growth.
On the protests, veteran investor Mark Mobius told CNBC on Friday: “It is a serious situation, no question about it, mainly because tourism is so important for Thailand and if you have unrest, tourism does not come in and you got a real problem.”
Reference: CNBC
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