Thailand economy faces slowdown amid rising debt and costs

Thailand is facing significant economic and social headwinds as of the second quarter of 2026. According to the National Economic and Social Development Council (NESDC), real GDP growth slowed to 1.9% compared to 2.8% in the first quarter. This deceleration is attributed to a triple threat of rising energy prices, increased production costs, and slowing household consumption.

Rising energy and production costs have placed immense pressure on small and medium-sized enterprises (SMEs), which struggle to pass costs to consumers. While private investment saw a 13.4% increase—driven by AI, decarbonization, and digitalization—consumer confidence has declined.

Social indicators also show growing instability. The number of unemployed persons rose by 9.7% to approximately 400,000, while underemployed workers reached 1.9 million. Household debt has climbed to 16.41 trillion baht, representing 85.9% of GDP, with a rising proportion of non-performing loans. Additionally, health concerns have emerged, with reports indicating that 27.4% of children aged 6 to 14 are overweight or obese.