The Thai economy grew at a sluggish pace in the first quarter as exports contracted amid weak spending, forcing the government to cut its 2015 growth outlook.
Gross domestic product rose only 0.3 percent in the first quarter, which was much slower than the revised 1.1 percent growth posted in the previous three months, the National Economic and Social Development Board reported Monday.
The agency downgraded the growth outlook for Southeast Asia's second-largest economy to 3-4 percent from 3.5-4.5 percent.
Krystal Tan, an Asia economist at Capital Economics, sees little scope for a rebound. The economy will struggle to achieve growth in excess of 3 percent this year, she said.
Meanwhile, the economy grew at the fastest annual pace since the first three months of 2013, when it grew 5.3 percent. GDP advanced 3 percent in the first quarter from last year, following the revised 2.1 percent expansion seen a quarter ago.
On the expenditure side, private consumption growth improved to 2.4 percent on a yearly basis from 2.1 percent. Investment climbed 10.7 percent after rising 3.2 percent in the previous quarter.
On the other hand, growth in government spending slowed to 2.5 percent from 3.6 percent and that in exports of goods and services decelerated to 1 percent as external demand slowed. At the same time, imports increased 2.3 percent.
The growth outlook for exports was trimmed sharply to 0.2 percent from 3.5 percent.
On the production front, the non-agricultural sector expanded by 4.1 percent due to an increase in manufacturing, construction, and services sectors. By contrast, the agricultural sector contracted 4.8 percent reflecting the decline in major crops production.
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