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1a BCRI

R&I Affirms A-/a-1, Stable : Kingdom of Thailand

ISSUER: Kingdom of Thailand

Foreign Currency Issuer Rating: A-, Affirmed

Rating Outlook: Stable

Domestic Currency Issuer Rating: A-, Affirmed

Rating Outlook: Stable

Foreign Currency Short-term Debts: a-1, Affirmed

1aBCRI      Thailand's economic fundamentals are underpinned by the agglomeration of manufacturing sectors,

centered on electronics/electric appliances and automobiles, through foreign direct investment. The

implementation of aggressive measures for industrial development will likely continue to help maintain its

mid- to long-term growth potential. In R&I's view, fiscal management will remain sound under the Fiscal

Responsibility Act. The current account balance has been consistently in surplus, and concerns over the

external position are small. Although recovery from the COVID-19 pandemic is expected to be somewhat

slow, R&I believes that these factors supporting the country's creditworthiness will remain unchanged,

and has affirmed the Foreign Currency Issuer Rating as well as the Domestic Currency Issuer Rating at A-.

      Domestic and external demand sagged in 2020 due to the pandemic, heavily affecting the economic

activity mainly of the tourism sector -- Thailand's strength. The real gross domestic product (GDP) in 2020

shrunk 6.1%. While it will likely rebound in 2021, uncertainty lingers about the prospect of the tourism

sector. The impact of political demonstrations that have continued since mid-2020 is another concern, and

R&I believes that Thailand's economic recovery may be slower than that of neighboring countries.

      Thailand faces the challenge of avoiding the middle-income trap -- a situation where an emerging

economy that attains a certain income level gets stuck in stagnation. With the growth in the labor force

population almost leveling off, the development of high value-added industries is essential for boosting

economic growth. The current government expressed its willingness to build infrastructure based mainly

on massive economic measures, such as the development of the Eastern Economic Corridor, and attract

investments from overseas in strategic industries. Given the robustness of the economic fundamentals,

these initiatives could deliver certain results. R&I pays attention to future developments out of a concern

that changes in the political climate could affect the progress of the economic measures.

     The current account stays in surplus. Even in 2020, when exports took a severe blow, the current

account balance recorded a surplus of 3.3% of GDP. A steady economic recovery could help revitalize

domestic investment, which is expected to moderately reduce the surplus. Supported by ample foreign

reserves relative to external debt, there are no concerns regarding foreign currency liquidity.

      Since the world economic crisis, the central government's fiscal deficit has widened. In FY2020 (from

October 2019 to September 2020), when the coronavirus pandemic struck the country, it equaled to 5.2%

of GDP, the second highest level after FY2009. In its budget for FY2021, the government expects a fiscal

deficit of 3.7% of GDP. That said, public debt levels remain low, and the government pays close attention

to fiscal discipline. It has the capacity to continue to provide fiscal support necessary for economic

measures, and yet a fiscal base is unlikely to be undermined.

      The primary rating methodology applied to this rating is provided at "R&I's Analytical Approach to

Sovereigns". The methodology is available at the web site listed below, together with other rating

Rating and Investment Information, Inc. TERRACE SQUARE, 3-22 Kanda Nishikicho, Chiyoda-ku, Tokyo 101-0054, Japan https://www.r-i.co.jp

Contact : Sales and Marketing Division, Customer Service Dept. TEL.+81-(0)3-6273-7471 E-mail. infodept@r-i.co.jp

Credit ratings are R&I's opinions on an issuer's general capacity to fulfill its financial obligations and the certainty of the fulfillment of its individual obligations as promised (creditworthiness) and are not

statements of fact. Further, R&I does not state its opinions about any risks other than credit risk, give advice regarding investment decisions or financial matters, or endorse the merits of any investment.

R&I does not undertake any independent verification of the accuracy or other aspects of the related information when issuing a credit rating and makes no related representations or warranties. R&I is not

liable in any way for any damage arising in relation to credit ratings (including amendment or withdrawal thereof). As a general rule, R&I issues a credit rating for a fee paid by the issuer. For details,

please refer to https://www.r-i.co.jp/en/docs/policy/site.html. © Rating and Investment Information, Inc.

Media Contact : Corporate Planning Division (Public Relations) TEL.+81-(0)3-6273-7273

NEWS RELEASE

methodologies that are taken into consideration when assigning the rating.

https://www.r-i.co.jp/en/rating/about/rating_method.html

R&I RATINGS:

ISSUER: Kingdom of Thailand

Foreign Currency Issuer Rating

RATING: A-, Affirmed

RATING OUTLOOK: Stable

Domestic Currency Issuer Rating

RATING: A-, Affirmed

RATING OUTLOOK: Stable

Foreign Currency Short-term Debts

RATING: a-1, Affirmed

COREHOON

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