Excluding Thailand's successful hosting of the IMF and World Bank Annual Meetings, which improved our international image and established us as a leading Asian country recognized for its true potential and living standards, this success benefits future investment and tourism.
One memorable statement came from a report announcement. The global economic outlook (World Economic Outlook: WEO) from the IMF stated that, despite recent periods,"The global economy has performed well amid numerous risks, but the succession of crises has pushed fiscal buffers to their breaking points."It called on all countries to promptly adjust policies and allocate sufficient resources to withstand the expected continuous shocks ahead.
From a straightforward perspective, the IMF is essentially saying we must act quickly to solve problems because the "reserves" we've accumulated nationally are nearly depleted, and if we fail to build new "reserves" in time, we might witness protests and unrest over welfare and livelihoods similar to those seen in some European countries.
The "debt trap," including rising "public debt" or government liabilities worldwide, affects budget spending capacity and debt repayment ability, along with increasing household debt, which pressures citizens and small businesses. This has been highlighted as a key concern.
Therefore, although the IMF continues to urge governments to "maintain fiscal discipline," it also stresses that governments must implement measures to support vulnerable populations to sustain their livelihoods.
Another worry is the rising "cost of living," driven by the ongoing "energy price crisis" amid war and geopolitical conflicts, as well as droughts and rapid climate changes linked to the "El Niño phenomenon" expected to begin this winter and continue next year. Trade wars and protectionism also contribute significantly to continuously rising personal expenses.
Meanwhile, the World Bank has expressed concern over unstable incomes and that more than 800 million new graduates worldwide may struggle to find jobs in the future.
Looking back at Thailand's economy, clear and ongoing signs of these vulnerabilities are evident.
Although Thailand's economy is projected to grow around 2.1-2.3% this year (as estimated), better than early-year expectations, nearly all forecasts predict a slowdown next year, with reductions in both public and private spending. Thais continue to face an ongoing high cost of living crisis.
At this point, instead of focusing on inflation figures, attention is on actual prices paid—fuel prices have risen again after a brief decline. Today, Gasohol 95 costs 42.04 baht per liter, and diesel B7 is 43.54 baht, while prices for ready-to-eat food and service expenses, which most people consume, remain high and tend to increase.
Additionally, the impact of the late September to early October "flood-plus" disaster has driven up prices for agricultural products, vegetables, and construction materials. The flood also caused many people to incur additional debts, some from informal sources.
In early October, Kasikorn Research Center and SCB EIC, the economic and business research arms of Siam Commercial Bank, both published articles on Thai household debt, agreeing that although household debt-to-GDP ratio dropped to 85.2% in Q2—the lowest in 25 quarters—the underlying figures reveal concerns about Thai household financial health rather than improvement.
SCB EIC notes that the decline in household debt reflects tighter credit access more than financial recovery. New debt growth comes mainly from personal consumption loans, while education and business loans continue to shrink, indicating debt is primarily used for consumption rather than income-generating activities. Households still face difficulty accessing institutional credit, with commercial bank lending contracting by 2.3% year-on-year.
SCB EIC also worries about the clearly weakening Thai labor market. August unemployment rose to 1.2%, the highest in 26 months, and average working hours fell 0.4% in the first half of the year. Flooding worsened household vulnerabilities, impacting about 1.69 million workers, mostly in Bangkok and nearby areas, especially in services and informal daily wage workers.
Kasikorn Research Center further highlights that debt repayment burdens remain a major limitation on household finances. Analyzing 2025 household economic and social survey data from the National Statistical Office, they found households earning up to 15,000 baht monthly have an average debt service ratio (DSR) of 40.1%, nearly half their income, compared to the overall average DSR of 26.3%. About 23.4% of these low-income households have a DSR over 40%.
It is unsurprising that Thai households face cash shortages; 23.8% of indebted households report insufficient income to cover expenses (negative cash margin). Among households earning up to 15,000 baht per month, over 48.8% have insufficient cash, while 25% of those earning 15,000–30,000 baht face negative cash margins.
Kasikorn Research Center also points out that unexpected expenses, like floods, could increase vulnerabilities among middle-income households. Their sensitivity analysis found a 10% rise in expenses would add 1.2 million households with negative cash margins, mostly earning 15,000–50,000 baht monthly.
At the same time, recent negative signals in the "financial index" appear in Q3 earnings of the five largest banks—Bangkok Bank, Kasikornbank, Krungsri, Krungthai Bank, and Siam Commercial Bank—all reporting net profit declines. Bank executives express concern about economic volatility and potential weakening purchasing power ahead. The profit decreases mainly result from lower interest income due to slowed new lending and debt write-offs to reduce non-performing loans.
All these factors require close monitoring, especially as the government faces budget and political stability constraints while debt and cost of living pressures intensify among low-income Thai households. The government should not overlook these signals to prevent economic problems from escalating into severe social issues with broader impacts.
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