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 The slump is expected to boost employment and pose greater risks to financial institutions. Unemployment could rise from 2.5 per cent of workforce to 3.8 per cent, or over 1.4 million.  The earlier forecast was flat or minus 2 per cent.

 Somchai Sajjapongse, director-general of the Fiscal Policy Office, said in his capacity as the ministry's spokesman that the economies in major export markets have deteriorated faster than expected, particularly in the past two months.

 He noted that while exports will plunge, imports will also shrink 25.2 per cent in terms of volume and 33 per cent in terms of value.

 "Though this means the trade surplus of US$22 billion and current account surplus of 9.8 per cent of gross domestic product, the surpluses would not benefit the economy as they are a result of imports shrinkage. Meanwhile, private investment has been delayed," he said.

 The ministry expected private investment to contract 6.1 per cent year on year. Meanwhile, private consumption would rise by only 1.2 per cent, despite the government's injection into the economy. Somchai cited that it is necessary for further injection to support the economy.

 "It is generally held that the GDP would show a minus growth this year, but there is a hope that the economy might recover late this year. The economy has reached its bottom in the first quarter, and contraction figures would be less severe in the second and third quarters. Meanwhile, in the rest of the year, the government will spend over Bt100 billion in extra budget," Somchai said. 

 The ministry expected the policy rate to fall further to 0.75 per cent, with annualised inflation at 0.7 per cent and the exchange rate of Bt36.2 against the US dollar.

 The ministry will revise the economy in the next three months. Somchai admitted that if things are not as planned, deeper economic contraction is possible.