Dagong Global Credit Rating Co., China's domestic rating agency, announced Wednesday that it has downgraded the rating outlook of Thailand from stable to negative mainly due to lasting political turmoil.
The political turmoil is unlikely to be alleviated in the short term, and thus will severely hinder normal economic activities, adding to the shrinking potential for growth, the agency said in a statement.
"Over the long term, the lasting political instability makes it difficult for the Thai government to concentrate all the advantageous resources on the upgrading of domestic industries," it said.
Dagong projects that the Thai economy will grow at a rate of 1.3 percent in 2014 and 2.5 percent in 2015, down from 2.9 percent last year.
The agency maintained both the country's local and foreign currency sovereign credit ratings at "BBB" on its solid industrial basis, growth potential and abundant foreign exchange reserves.