Thailand's Gross Domestic Product (GDP) shrank 12.2 percent in the second quarter of this year from a year ago, the biggest decline in 22 years since the Asian financial crisis in 1998, the state economic planning agency said on Monday in a press briefing.
The National Economic and Social Development Board (NESDB) said Thailand's household debt increased to the highest level in four years, whereas the GDP for the second quarter contracted 12.2 percent.
"Therefore our forecast for the growth rate for the whole year will contract by 7.8 to 7.3 percent, instead of 5 to 6 percent as previously predicted, due to the impact of the COVID-19 pandemic," said Tossaporn Sirisamphan, secretary-general of the NESDB.
"However, the adjusted growth rate for the whole year was based on the assumption there is no second wave of COVID-19 infections in Thailand, and also if the Thai government restricts the arrival of foreign tourists until the end of this year."
Tossaporn also said that the assumption was also based on the fact the adverse effects on the production sector will not impact financial institutions, among others.
Tossaporn said that the NESDB would propose to the Bank of Thailand and the Finance Ministry to roll out new stimulus packages to help businesses, working people and the tourism sector.
"In regards to tourism stimulus, it should encourage tourists to travel to provinces further away from the capital during weekdays."
According to the NESDB, employment in the production and agricultural sectors, for the first quarter of this year, dropped 1.9 percent, with the unemployment rate rising 1.95 percent.
It also said that the hospitality sector saw the highest unemployment rate, estimated at 18.3 percent, followed by the retail sector's 14.6 percent, with most of the low skilled unemployed averaging 40 years old.
For the whole year, the NESDB predicts that about 2 million people would be rendered jobless, excluding informal workers who are not covered by social security system.
Household debt increased 3.9 percent for the first quarter of the year, compared to the same period last year, the NESDB said.