(Adds forecasts)
By Trisanat Kongkhunthian
BANGKOK, Dec 24 (Reuters) - Thailand's export-driven economy will shrink in the fourth quarter and barely grow in 2009, mainly due to a global economic slowdown that is likely to get worse next year, the government said on Wednesday.
The country's new finance minister, Korn Chatikavanij, told reporters this year's growth was set to come in at 3 percent and projected 2009 growth at between zero and 2 percent, the worst in a decade.
The ministry said the economy could contract in the first quarter of 2009 as well, which would add Thailand to a growing list of countries in recession, commonly defined as two consecutive quarters of declining economic output.
Analysts polled by Reuters two weeks ago projected growth of 2.8 percent in 2009, down from 4.5 percent this year and 4.9 percent in 2007. [ID:nBKK388713].
The double blow from the global slowdown and blockade of Bangkok's airports by anti-government protesters during the peak tourist season has many economists drawing comparisons to the 1997-98 Asian crisis when the Thai economy shrank 10.5 percent.
Earlier this week, the Commerce Ministry said exports fell 18.6 percent from a year earlier in November, the first monthly drop since 2002, due to falling global demand for the country's goods and the crippling eight-day airport blockade.
Multinational companies that use Thailand as a base for exporting everything from electronics to cars are making near daily announcements of job or production cuts.
On Wednesday, Japan's Honda Motor Co said it will temporarily suspend 700 contract workers at its new plant in Thailand next month due to a sharp drop in car sales. [BKK403203]
In its latest update on the Thai economy, the Finance Ministry said it had worsened considerably since September when the ministry forecast 5.1 percent growth for 2008.
"The economy has performed much worse than expected," Somchai Sajjapong, chief of the Finance Ministry's Fiscal Policy Office, told a news conference to announce its revised growth forecast of 3 percent for this year.
He said the economy would likely shrink by 2-3 percent in the fourth quarter and could contract further in the first three months of next year.
"The global slowdown has had a clear impact on Thailand, judging from the sharp drop in exports which account for 50-60 percent of GDP," he said.
Somchai also blamed Thailand's intractable political crisis which has seen five prime ministers in just over two years and paralysed government policymaking.
The shaky multi-party coalition government led by Prime Minister Abhisit Vejjajiva has made reviving the economy its top priority, but analysts say he has little room to manoeuvre.
Details of a 200 billion baht ($5.8 billion) stimulus package will be announced after Abhisit's maiden speech to parliament on Dec. 29 and will likely be implemented early next year.
Korn gave a preview of the package of Wednesday, saying it would include tax breaks to spur the property market.
"The government needs to boost demand for property because this sector is crucial for several businesses such as building and materials. We have to do it quickly," Korn told reporters. (Writing by Orathai Sriring; Editing by Darren Schuettler and Tomasz Janowski)