Thailands economy has slowed substantially over the past year, with real GDP growth falling to 4.5 percent for 2005, down from 6.1 percent in 2004. The effect of the December 2004 tsunami on the tourism sector and the impact of high Oil prices both contributed to the slowing of economic growth. Increased demand for Thai exports, as Well as increases in domestic spending by the Thai government on infrastructure projects strengthened growth somewhat in the second half of the year. Real GDP growth for 2006 is projected at 4.9 percent. Longer-term annual growth rates are projected in the range of 5-6 percent.

The Thai economy is burdened by a relatively weak banking sector with a high proportion of non-performing loans.  Delays in the restructuring of corporate debt also have been worrisome enough to prompt warnings from the International Monetary Fund (IMF) and international credit rating analysts.  Any worldwide economic downturn could rapidly affect Thailand due to these structural weaknesses.
Thailands energy sector is undergoing a period of restructuring and privatization.  The Thai electric utility and Petroleum industries, which historically have been state-controlled monopolies, are currently being restructured.