(Bloomberg) -- Thailand’s economic growth was weaker-than-expected in 2024 and continued to lag its neighbors as it faces a year fraught with risks from global trade policy hurdles and sluggish domestic demand.

Southeast Asia’s second largest economy grew 2.5% last year, the National Economic and Social Development Council said Monday. That was slower than the median estimate for a 2.7% gain in a Bloomberg News survey although it picked up from a revised 2% expansion in 2023.

Gross domestic product rose 3.2% in the three months through December from a year earlier, against a 3.8% forecast by economists. On quarter, the economy grew 0.4% from the July-September period compared with a median estimate for a 0.5% rise.

Even with the firmer recovery in tourism and exports, the nation remains a growth laggard in the region as household consumption and manufacturing continue to be under pressure. In the latest phase of Donald Trump’s tariff policy and the US-China rivalry, Thailand is vulnerable given its significant trade surplus with the US and the persistent flooding of cheap China-made products that may worsen as Washington hits Beijing with more levies.

Bank of Thailand Governor Sethaput Suthiwartnarueput said on Sunday that he considers trade policy spillover as a main challenge.

Import flooding is a factor constraining Thailand’s recovery, Sethaput told a panel in Saudi Arabia, adding that the country’s manufacturing sector had been badly hit. The local media had reported that thousands of Thai factories are unable to compete with cheap imported goods have shuttered in the past few years.

Thailand, which posted a trade surplus of $35.4 billion with the US in 2024, is planning to boost imports of US ethane and agricultural products to avoid getting into the crosshairs of Trump who sought to impose tariffs on countries that sell more to America than they buy.

The state planning agency maintained its forecast expansion of 2.3%-3.3% for 2025, according to NESDC chief Danucha Pichayanan at a briefing in Bangkok. Energizing domestic consumption would help drive growth this year, he said as the agency forecasts a 3.3% growth in private spending and a 1.3% rise in government consumption.

Uncertainty from US trade policies is key risk for Thailand, Danucha said. “We will monitor closely and come up with measures to negotiate with US. We are under the spotlight as we recorded high trade surplus versus the US.”