Thailand’s Business Confidence Declines as Investment Falls Behind ASEAN Peers

Bangkok, Thailand, March 2025 –  Thailand’s mid-market businesses are facing increasing pressure as business confidence drops sharply, with investment in technology, workforce development, and productivity failing to keep pace with ASEAN peers. This trend, highlighted in the latest Grant Thornton International Business Report (IBR) for Q4 2024, raises concerns about the country’s long-term competitiveness in an evolving regional landscape.

Thailand’s economy

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 Despite GDP growth accelerating to 3.0% in Q3, business leaders in Thailand remain cautious about long-term investment, particularly in digital transformation and workforce skills, raising concerns over future GDP growth.

Optimism Drops and Investment Slows

While Thailand’s economic momentum improved in late 2024, business confidence has weakened:

• The percentage of businesses expecting an increase in exports over the next 12 months fell from 51% to 46%, trailing ASEAN (64%), global (55%), and Asia-Pacific (51%) counterparts, highlighting weakening external demand.
  Revenue growth expectations dropped from 86% to 73%, signalling rising uncertainty.
  Profitability expectations declined from 80% to 76%, compared to ASEAN’s 77% and Asia-Pacific’s 57%, again signalling rising uncertainty.

Investment in critical growth areas is slipping, with Thailand lagging behind regional competitors:

• Technology investment dropped from 56% to 46% (ASEAN: 71%).
  Workforce investment declined from 43% to 37% (ASEAN: 59%).
  Employment growth expectations fell from 47% to 43% (ASEAN: 60%).

Ian Pascoe, CEO & Managing Partner at Grant Thornton in Thailand, commented: "Thai mid-market businesses are at a crossroads. While economic growth currently remains stable, declining business confidence and slowing investment signal deeper structural challenges. To stay competitive, businesses must embrace digital transformation and workforce development – without these, Thailand risks losing ground to regional peers. Generally businesses will only invest if they are confident about the future. This data indicates they are not." 

Growing Constraints and Rising Uncertainty

The IBR also highlights growing constraints on Thai businesses:

• Economic uncertainty rose from 46% to 52%, making it the top concern for business leaders.
  Concerns over regulation & red tape increased from 26% to 34%, further adding to business pressures.
  Cybersecurity & digital risk awareness remains low, with just 26% seeing it as a major concern – far below global averages.

A Warning for the Future
While Thailand’s economy is currently growing, the decline in investment and business confidence raises concerns about long-term competitiveness and economic success. Grant Thornton urges Thai businesses to prioritise investment in innovation, workforce skills, and technology adoption to drive productivity in an increasingly competitive ASEAN and global market.

Looking to the future, the potential for U.S.-led tariff changes could place even greater pressure on the Thai economy, while closer to home, risks such as high household debt levels, political instability, reduced lending by the banks, and the potential failure of poor-quality corporate loans will also influence economic success this year.

About the IBR
The Grant Thornton International Business Report (IBR) has provided insights into mid-market sentiment globally since 1992. The Q4 2024 research is based on interviews with 90 mid-market business leaders in Thailand, conducted between 2 October and 8 November 2024. The data, analysed in collaboration with Oxford Economics, evaluates business health, investment trends, and key growth constraints.

For more information, please contact:

Rattanakorn Sutthiphongkait
Marketing Communications and Branding Manager
Marketing Communications & Business Development (MCBD)
 D: +66 2 205 8222 ext. 8144
Email: marketing@th.gt.com