Goldman Sachs Cut Thailand’s 2021 GDP Forecast to 1.4% amid Rapid Spread of Delta Strain

Goldman Sachs cut Southeast Asia GDP forecasts amid rapid spread of Covid-19 delta variant, particularly in Thailand, Indonesia and Malaysia in recent weeks.

The US investment bank lowered its 2021 economic growth projections for Thailand to 1.4% from the previous forecast 2.1% and slashed GDP growth for Indonesia and Malaysia to 3.4% (from 5%) and 4.9% (from 6.2%). While revised down Singapore growth outlook to 6.8% from 7.1%. 

The spread of the more transmissible delta variant has pushed daily Covid cases to record highs in several major Southeast Asian countries, including Thailand, in recent weeks. As a result, those countries are forced to impose stricter Covid-19 restrictions, which are expected to “weigh significantly more” on growth in the second half of 2021 than previously thought, Goldman Sachs said.

Furthermore, the group is facing a slow vaccination pace despite a spike in Covid infections across the region— except for Singapore —.