Thai Q4 GDP growth disappoints, full-year 2014 pace 0.7 percent

Bangkok, Thailand.
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Bangkok, Thailand.

Thailand's economy grew less than expected in October-December and had full-year 2014 growth of only 0.7 percent, as exports and consumption remained weak long after a May coup aimed at helping to spur recovery.

The poor performance in 2014 will put more pressure on the military junta to speed up infrastructure spending this year to lift growth in Southeast Asia's second-largest economy.

The economy grew 1.7 percent in final quarter of 2014 on a seasonally-adjusted basis from the prior three months, and 2.3 percent from a year earlier, the state planning agency said on Monday.

Economists in a Reuters poll had forecast quarterly growth of 2.3 percent in October-December, and an annual pace of 2.4 percent.

The full-year growth was the weakest since flood-hit 2011. In 2013, there was 2.9 percent expansion.

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Thailand is the last major Southeast Asian economy to report 2014 growth, and had by far the weakest. Malaysia last week reported higher-than-expected four-quarter and 2014 growth.

For months prior to the coup, Thailand suffered virtual paralysis in policy-making amid political tensions. The junta has struggled to lift growth as exports remain weak, consumption is still subdued and government spending slow.

The October-December performance was the best for any quarter for last year, but reflects a low base from late 2013, when anti-government protests began. Badly-hit tourism is recovering slowly.

The agency revised economic on-quarter growth in July-September to 1.2 percent, from 1.1 percent stated earlier.

The central bank, which has kept its policy interest rate at 2.0 percent for nearly a year, next meets on March 11.

The National Economic and Social Development Board (NESDB) on Monday kept unchanged its 2015 growth forecast of 3.5-4.5 percent. It cut its export growth projection to 3.5 percent from 4.0 percent.