Bangkok (VNA) - The Asian Development Bank (ADB) has predicted that the Thai economy will shrink by 4.8 percent this year due to the COVID-19 pandemic, heading for its deepest contraction since the Asian financial crisis in 1998.

In a recent report, ADB also said the country’s gross domestic product (GDP) will recover to 2.5 percent in 2021.

Exports of goods and services are projected to continue to decline this year, mainly due to the pandemic, before turning around next year. The impact of the disease on merchandise exports is likely to become clearer in the second quarter of 2020.

Some exports such as electronics, automobiles and chemical products are likely to suffer hits from supply chain disruptions in mainland China, while other exports, notably metal products, machinery and equipment, could gain from trade diversion, though probably not enough to offset the impact from supply chain disruption.

Exports of services are also expected to decline in 2020 with a significant drop in foreign tourist arrivals but will rebound in 2021 as they return, the ADB added.

Meanwhile, the Siam Commercial Bank's Economic Intelligence Center and the Standard Chartered Bank in Thailand forecast a contraction of 5.6 percent and 5 percent, respectively.

The Thai government recently unveiled a fresh stimulus package worth 1.68 trillion baht (over 50.87 billion USD), or about 10 percent of its GDP, to cushion the blow from the COVID-19.

Thailand’s Deputy Prime Minister Somkid Jatusripitak said the package will cover all economic sectors for at least the next six months./.