The slowdown was due to political unrest, which hurt local demand, investment and tourism.
In November of 2013, several anti-government protests began in Bangkok, forcing many ministries and state agencies to close. The election held on February 2nd was disrupted, failing to end the crisis and a caretaker administration proceeds, with only limited spending and borrowing powers.
Latest figures released by the Bank of Thailand in January 2014 showed that in the last month of 2013, the private investment index contracted 8.1 percent (yoy), given that most businesses had already accelerated their investment earlier, while others decided to postpone investment amid current economic and political uncertainties.
Households remained cautious in the same period. While the private consumption index fell 0.2 percent (yoy), mainly due to lower spending on automobiles, delayed payments to rice farmers also weight on consumption.
In December of 2013, the tourism sector expanded at a slower pace after the enforcement of China’s new tourism law since October of 2013 and amid domestic political unrest.
Compared with the same quarter of 2012, the economy advanced a meager 06 percent. In January, the Bank of Thailand cut its 2014 growth forecast to around 3 percent from 4 percent.