As manufacturing stalls and household debt nears 90% of GDP, Southeast Asia’s second-largest economy faces a structural crisis and political instability.
The era of Thailand as a high-growth "Economic Tiger" has come to an abrupt halt.
Once the envy of its neighbours, the country is increasingly being referred to as the "Sick Man of Asia," as reported by the Financial Times.
The nation now finds itself grappling with a severe economic paralysis across its three primary pillars: consumption, manufacturing, and tourism.
A Decade of Decay
The transition from a regional powerhouse to a stagnant economy has occurred with alarming speed.
According to Burin Adulwattana, chief economist at Kasikorn Research Centre, the shift took place in just a decade.
Having peaked with 13% growth in 1988, the Thai economy has been trapped at a meagre 2% growth rate for the last five years.
Several structural "anchors" are dragging the nation down:
Demographic Collapse: Thailand’s population has shrunk for four consecutive years, with 2025 birth rates hitting a 75-year low.
Debt Distress: Household debt is now approaching 90% of GDP, the highest ratio in Asia, stifling domestic spending.
Eroding Edge: Thailand is rapidly losing its competitive advantage to more agile regional rivals.
The Automotive Retreat
The manufacturing sector—long the heartbeat of the Thai economy—is under siege from an influx of cheap Chinese goods and fierce competition from Vietnam.
The automotive industry, formerly a crown jewel, is in visible retreat.
Heavyweights including Nissan, Honda, and Suzuki have responded to the downturn by either shuttering factories or significantly reducing production capacity.
The financial markets have reflected this grim reality; in 2025, the Thai stock market was the worst performer in Asia, shedding 10% of its value in local currency terms.
https://www.nationthailand.com/business/economy/40062077
Kuala Lumpur raids illegal beauty salons, arrests 15 foreigners. - Photo: Immigration Department
Kuala Lumpur Bukit Bintang Shocks Illegal Beauty Salon! Uncertified "doctors" use foreign tourist visas to secretly make money, making hundreds of thousands of ringgit a year. According to law enforcement footage, some slogans in the store read "Thin and Beautiful".
Immigration Director Datuk Zakaria issued a statement today (4th) stating that an illegal beauty salon in Bukit Bintang, Kuala Lumpur, suspected to be operated by an uncertified Chinese "doctor", was raided and seized by the Immigration Department.
Yesterday's operation investigated a total of 18 people and resulted in the arrest of 15 foreigners, including 6 Chinese men, 7 Chinese women, and 2 Burmese women.
In addition, three locals must be questioned at the immigration office to assist in the investigation.
According to the investigation, the beauty salon provided facial and body beauty services without permission from the Ministry of Health, and involved foreigners abusing ordinary tourist visas and working illegally.
"The beauty salon is suspected to be owned by a Chinese national who also abused his visa to operate and has been in business for a year, illegally making hundreds of thousands of ringgit during this period."
During the operation, immigration officers seized uniforms, mobile phones, computers, CCTV, "business licenses" and other relevant documents.
All arrested foreign nationals will assist in investigations under section 6(1)(c) of the Immigration Act 1959/63 (stay without lawful permit) and section 39(b) of the Immigration Ordinance 1963 (breach of entry permit provisions).