Rapid export growth continued to fuel the economy, but there has additionally been an increase in capacity utilisation and acceleration in capital goods imports, which the bank said suggested a nascent domestic demand recovery was also in progress.

Ulrich Zachau, World Bank director for Thailand, Malaysia and regional partnerships, said: “With economic growth exceeding 4% this year, for the first time since 2012, Thailand has the potential, with intensifying structural reforms, to raise productivity and grow even faster over the medium term.”

Zachau said education and skills reforms, infrastructure investments and increased competition – in particular in services – would be key factors in determining whether Thailand entered into higher long-term growth.

The bank’s Thailand Economic Monitor stressed the importance of innovation for productivity and long-term growth. It noted Thailand ranked 52 out of 128 in the Global Innovation Index in 2017 and so had the opportunity to attract and foster high-quality entrepreneurs and innovative investments if it adopted innovation-friendly policies.

These should include stronger competition policy, establishing a national data strategy and improving intellectual property rights, the bank said.

Kobsak Pootrakool, minister attached to the prime minister’s office, said: “Thailand cannot attain advanced country status if it cannot meet the challenges of innovation.”