S&P Downgrades Thailand Outlook to “Stable” on the Disruption by the Coronavirus Outbreak

S&P Global Ratings has revised down its outlook on Thailand from “Positive” to “Stable” on coronavirus uncertainty and the possibility of the delay in political transitions to an elected civilian government over the next 12 months.

 

“A severe economic fallout, coupled with the sweeping powers accorded by the Emergency Decree, can potentially disrupt progress toward putting in place political structures and policies to alleviate deep-rooted socioeconomic fissures across the country,” stated the rating agency.

S&P expected Thailand’s GDP to contract by 2.5% in 2020 due to the plummet in tourism and merchandise trade as travel restrictions were enforced globally to contain the spread of coronavirus.

Nevertheless, S&P Global Ratings expected Thailand’s GDP to rebound by 7.6% in 2021 if the country can successfully contain the outbreak of coronavirus within this year.

Aside from the “Stable” outlook, S&P 500 affirmed “BBB+” long-term and “A-2” short-term foreign currency sovereign credit ratings and “A-” long-term and “A-2” short-term local currency ratings.