Thailand: Global economy to grow by 3.2% amid downturn

The global economy is growing at 3.2% this year, a substantial drop from 6% last year, with an even gloomier outlook for next year, according to Finance Minister Arkhom Termpittayapaisith after the Apec Finance Ministers’ Meeting on Thursday.

Mr Arkom announced the forecast as part of the result of the meeting, which was attended by finance ministers and representatives of the 21 economic areas in the Asia-Pacific Economic Cooperation (Apec).

Officials from the Asian Development Bank, International Monetary Fund (IMF), World Bank Group, Organization for Economic Cooperation and Development, and Apec Policy Support Unit also attended, the statement said.

The meeting at the Queen Sirikit National Convention Center where Apec Economic Leaders’ Week will be held next month, touched on issues about sustainable finance and digitalisation for a digital economy, it said.

Finance ministers discussed inflationary pressure and how to redirect Covid-19 stimulus measures to long-term growth drivers while maintaining fiscal sustainability, the statement said.

At a press conference after the meeting, Mr Arkhom said the IMF presented its forecast on the global economy expanding at 3.2% this year, a significant drop from 6% last year. Next year, the world’s economy is predicted to take a further slide with growth at 2.7%. For Apec economies, the bloc’s growth this year is forecast at 2.5%, slowing from 5.9% last year, he said. The prediction for next year is on a slightly more positive note, he said, with a 2.6% expansion.

The meeting warned of a continuous volatile state for the world’s economy, under pressure from tightened fiscal policy, the strengthening of the dollar, and the energy crisis, he said.

He also said the meeting predicted Thailand’s economic growth to come in at 3–3.5% this year, rising from 1.5% last year. Spurring the hike is the recovery in the tourism sector and a targeted fiscal policy to alleviate the impacts of high energy prices and consumer products, he said, adding national and regional investments were promoted.

He said the meeting also looked at the Asean Catalytic Green Finance Facility, which aims to enable the development of green infrastructure. It also acknowledged the results of a forum on Developing the Ecosystem for Sustainable Finance in the Capital Market in Bangkok in June, he said.