S&P Global Ratings revised its outlook on Thailand to positive from stable, saying political uncertainty in the country has started to ease following the return of an elected government earlier in 2019.

The rating agency also said that the National Strategy Plan rolled out by the government to spur economic growth supports political stability over the next three to five years.

"With progress in implementing national reforms and strategy plans, we believe policy continuity and political stability will improve," said S&P Global Ratings, which affirmed Thailand's long- and short-term foreign currency sovereign credit ratings at BBB+/A-2.

Despite the improving political situation, Thailand is still facing economic headwinds that have intensified, including the U.S.-China trade tensions, a slowing tourism sector and the surging Thai baht that weakens the country's export competitiveness, S&P Global Ratings said. The rating agency expects Thailand's real GDP to grow 2.6% in 2019, lower than its previous forecast of a 3.8% expansion.

Thailand is expected to post a net asset position of about 26% of current account receipts in 2019 on a narrow net external debt basis. The country's net general government is projected to hit an average of 2.5% of GDP in the 2019-2022 period, according to S&P Global Ratings.

While the government is expected to adopt a more expansionary fiscal policy in the coming years to boost growth, major infrastructure investment would be assumed by state enterprises and public-private partnerships, the rating agency said.

Robust monetary policy and price stability measures undertaken by the Bank of Thailand also support the economy's credit profile, it added.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.