R&I affirms Thailand's credit rating at A-, maintaining a stable outlook.
R&I affirms Thailand's credit rating at A- and maintains a stable outlook.
May 15, 2569 - Ms. Jindarat Viriyathaveekul, Director of the Public Debt Management Office, revealed that on this day (May 15, 2569), Rating and Investment Information, Inc. (R&I) affirmed Thailand's sovereign credit rating at A- and maintained a stable outlook. R&I explained the reasons and key factors behind this decision as follows:
- Real GDP Growth The Thai economy is projected to expand by 2.4 percent in 2568, driven by significant increases in exports and the trade balance between Thailand and the United States, amidst uncertainties arising from reciprocal tariff policies. However, in 2569, the Thai economy is likely to face pressure from rising global energy prices due to conflicts in the Middle East, high levels of household debt, and structural constraints from an aging population, all of which could impact consumption and economic growth prospects.
2. The public debt-to-GDP ratio stood at 64.7 percent at the end of September 2568. R&I believes the government will be able to manage public debt within the fiscal discipline framework as stipulated by law, and also implement the Medium-Term Fiscal Framework (MTFF) to gradually reduce the fiscal deficit to below 3 percent of GDP by fiscal year 2572.
Furthermore, the majority of public debt is issued through domestic government bonds, limiting the government's financing risk. However, if the global energy price situation persists, the government may need to implement further fiscal restructuring measures, such as reviewing government spending, adjusting the fuel fund mechanism, or modifying value-added tax, to maintain fiscal sustainability.
3. R&I believes that despite limited government fiscal space , the current government continues to push forward with the “Thailand 10 Plus” policy to promote investment in future industries such as Artificial Intelligence (AI) and Electric Vehicles (EVs), coupled with measures to stimulate domestic consumption. This is expected to help drive economic growth to at least 3 percent in the coming period.
4. The external finance sector remains strong, with the current account in surplus driven by growth in tourism revenue and merchandise exports, particularly in the automotive and electronics sectors. Foreign direct investment (FDI) continues to show a positive inflow trend. Furthermore, international reserves are higher than foreign debt, which remains at a low level, resulting in limited external liquidity risk.
5. A key factor that R&I will monitor when considering Thailand's credit rating is progress in restructuring the economy towards future industries, which plays a crucial role in maintaining the strength of its external position in the medium term.
“The aforementioned credit rating assessment reflects confidence in Thailand's stable macroeconomic fundamentals, as well as the government's economic policy direction which prioritizes fiscal discipline, transparency, and prudent management of external risks. This is coupled with the push for structural reforms to support the transition to a “new economy,” which will transform structural constraints into opportunities for development, enhance the country's competitiveness, and support Thai economic growth in both the short and long term.”
Read all economic news throughout Thailand here.
