Thailand Q2 Growth Slows Despite 176bn Baht Relief Scheme

Thailand Q2 Growth Slows Despite 176bn Baht Relief Scheme

BANGKOK, Aug. 18, 2026 — Thailand’s economy grew 1.9% year-on-year in the second quarter of 2026, slowing sharply from the previous quarter and recording the weakest expansion among six major ASEAN economies, according to the National Economic and Social Development Council (NESDC).

The figure came despite a 176 billion baht “Thai Help Thai Plus” relief scheme approved by the cabinet and running from June through September.

NESDC Secretary-General Danucha Pichayanan said on Monday that economic growth slowed from 2.8% in the first quarter. On a seasonally adjusted basis, the economy contracted 0.2% from the previous quarter.

Thailand’s Q2 growth lagged behind Vietnam at 8.4%, Malaysia at 6%, Singapore at 5.9%, Indonesia at 5.29% and the Philippines at 2.3%.

The slowdown was driven largely by weaker domestic demand. Private consumption grew 1.9%, down from 3.3% in the first quarter, while government consumption increased just 0.2%, compared with 3.4% previously.

Public investment also fell 1.6%, reversing a 9.4% increase in the first quarter. Consumer confidence dropped to 50.3, its lowest level in 14 quarters.

Several key sectors also lost momentum. Manufacturing expanded only 0.1%, while agriculture, accommodation and food services each grew 1.5%. Transport and storage increased 2.6%, while construction growth slowed to 0.1%.

Private investment was a major bright spot, rising 13.4% from 10.1% in the first quarter — its strongest growth in 54 quarters, or since late 2012.

Goods exports also performed strongly, increasing 17.6%, driven largely by electronics and high-tech products. Exports of telecommunications equipment surged 129%, while computer parts and equipment rose 65.5%.

Despite the weak second quarter, NESDC raised its full-year 2026 growth forecast to 2.0%-2.5%, with a midpoint of 2.2%, from its previous range of 1.5%-2.5%.

The agency cited stronger export prospects, increased foreign-tourism revenue, stronger private investment and a modest improvement in consumer spending.

Export growth is now forecast at 15.1%, while foreign-tourist revenue is expected to reach 1.65 trillion baht. Private investment is projected to expand 9.6%, while private consumption is forecast to grow 2.6%.

Danucha, however, warned that Thailand’s outlook remains exposed to global economic and trade uncertainty, weaker global demand, possible El Niño effects on agriculture, high household debt and credit risks facing small and medium-sized businesses.

The figures underscore the challenge facing Thailand as the government seeks to support domestic demand while relying on exports, private investment and tourism to sustain economic growth.