The Siam Commercial Bank’s Economic Intelligence Center has predicted that these countries will see a momentum in economic growth this year, but it will be less than its growth potential before the COVID-19 pandemic.
According to the Thai bank, the rebound will vary across these nations, based on economic fundamentals and risks specific to each country.
The report released on February 1 expects Vietnam to see the highest economic growth of 6.2 percent, followed by the Cambodian economy that will grow 5.5% in 2023, Laos and Myanmar come third in the list with an anticipated 3% annual growth.
A domestic demand for goods and services alongside tourism are said to be key factors that will drive economic recovery for these SE Asian countries in 2023.
Improvements in the labor market would assist in increasing domestic demand and Vietnam’s fourth quarter employment rates of 2022 has already been reported to have increased to its highest level since the outbreak of COVID-19.
With China reopening its borders last month, the service sector will also get a shot in the arm from more international tourists visiting these countries. In 2019, Chinese travelers comprised of around 30-35% of total foreign travelers.
Outbound group tours to Cambodia and Laos are resuming again from February 6, and more countries are expected be added to the list in the near future.
The report expects Cambodia and Vietnam to benefit the most from an increased influx of visitors, as the tourism industry accounts for 18.2% and 9.8% of their GDP, respectively.