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The Kingdom's economy in the current quarter is also forecast to slow, because of the fallout from the financial crisis in the US.

UTCC yesterday said its forecast was based on the assumption that the US's financial problems will not be resolved quickly and that the world economic slowdown would not be short-lived.

Thanawat Polvichai, director of the university's Economic and Business Forecasting Centre, said his agency estimated the country's export growth would drop from the projected 20 per cent this year to 8-10 per cent next year.

Thai economic growth next year is now forecast to grow 4-4.5 per cent, against a projected 4.8-5.8 per cent for this year. The Bank of Thailand is expected to revise downwards this year's economic-growth numbers later this month.

"It is predicted the world community will spend at least US$1 trillion [Bt34 trillion] to solve the current economic and financial problems," he said, adding that the global economy was expected to start recovering in next year's first quarter, with growth seen from the second quarter.

However, the Thai economy has shown signs of only slow growth, because of the continuing political crisis, as well as product prices remaining high, delaying consumer spending.