The NESDB had previously forecast growth in the range of 3-3.5 per cent, but it now believes there is high potential for growth in the upper part of that range, which is more optimistic than May’s forecast.

Another reason for the more positive outlook is rising tourist numbers, NESDB secretary-general Porame-tee Vimolsiri said.

He said last week’s bomb blasts should not affect economic growth as they were one-off incidents, and was confident that everything would get back to normal soon.

Moreover, with the majority vote in favour of the draft charter, the NESDB foresees stable politics and high foreign-investor confidence, as the junta now will follow its “road map to democracy”. As a result, growth of gross domestic product in the remaining months of 2016 should be stable.

However, the persistently sluggish global economy and fluctuation of the baht are major negative factors that could hold back the Thai economy.

Porame-tee said the baht was expected to continue appreciating in the current second half of the year, which could be a damper on exports.

The baht will average 35-36 against the US dollar this year, the NESDB says. The global oil price is projected in the range of $35-$45 per barrel.

Based on the assumption of 3.3-per-cent GDP growth, the NESDB projects that investment will grow by 3.3 per cent this year. Investment by the private sector will increase 1.5 per cent, with the government sector’s rising by 10 per cent.

Private consumption is expected to expand by 2.7 per cent this year, and government consumption expenditure by 3.9 per cent.

Export is expected to shrink by 1.9 per cent, while inflation will average 0.1-0.6 per cent this year.

The NESDB reported that in the second quarter, year-on-year GDP growth was 3.5 per cent, compared with 3.2 per cent in the first quarter.

On the production side, the non-agricultural sector expanded by 3.7 per cent in the second quarter, while the drought-affected agricultural sector declined slightly by 0.1 per cent. However, the agricultural sector is expected to grow in the third and fourth quarters after the end |of the drought and higher crop prices.

Domestic demand grew in the second quarter, mainly attributed to strong private consumption, which was up 3.8 per cent year on year. Government spending was up by 2.2 per cent, and gross fixed capital formation by 2.7 per cent.