BANGKOK -- Thailand's economy slowed in the July-September quarter as the trade war and a slowdown in tourism started to bite, prompting the state planning agency to lower its annual growth forecasts.
Southeast Asia's second-largest economy grew 3.3% on an annual basis, falling below projections of a 4%-4.2% expansion in a Reuters poll of analysts. Gross domestic product showed no growth from the previous three months.
Thailand is not the only Asian nation to feel the effects of the trade spat between the U.S. and China. The latest data for the economies of the Philippines, Indonesia, Malaysia, China, and South Korea all showed weaker expansions, while Japan contracted in the third-quarter.
"Although other engines were quite solid, the two major engines of exports and tourism share a big proportion of the country's GDP and that weighed" on Monday's data, said an analyst at Kasikorn Research Center.
Exports, which account for more than 60% of the nation's GDP, dropped 5.2% in September -- the first drop in 19 months. This shows the trade spat between the U.S. and China is beginning to have an adverse effect on outbound shipments.
The National Economic and Social Development Board projected that exports would rise 7.2% this year, down from a previous forecast of 10%.
The fall in Chinese visitors to the country pushed down revenue from tourism, which makes up 20% of the economy. Nearly 50 tourists from China were killed in a boat accident in July.
The national planning agency revised down its annual GDP growth forecast to 4.2% from a previous projection of 4.2%-4.7% range. The agency projected growth of 3.5%-4.5% in 2019.
"The economy grew more slowly than expected due to falling global demand as the trade war cut demand from Thailand's trade partners," said NESDB secretary-general Tosaporn Sirisamphan.
But Tosaporn said the overall Thai economy remained resilient, backed by a low unemployment rate of 1% and inflation of around 1.5% Government investment grew 4.2% and private investment rose 3.9% -- the most in 15 quarters -- as authorities sought overseas money, particularly in the nation's Eastern Economic Corridor.