WASHINGTON - Thailand's political chaos could dent economic growth in the kingdom which is already expected to post a contraction this year, the Asian Development Bank said Monday.

The Manila-based lender has forecast that Thailand's economy will shrink by two percent in 2009 as it is hit by the double whammies of the global economic crisis and domestic turmoil.

"If the social instability continues, that growth rate could moderate," ADB acting chief economist Jong-Wha Lee said on a visit to Washington.

Lee said the chaos threatened to hit tourism, a major money-maker for the kingdom, as well as investment as businesses become less confident about spending plans.

Lee regretted that anti-government protests forced a cancellation of a major Asian summit, which he said could have taken action on the global economic crisis.

"This is very unfortunate because they could have made a little more concrete their decisions on this so-called Chiang Mai Initiative," said Lee, who participated last week in preparatory meetings for the summit.

The Chiang Mai Initiative is a system of bilateral currency swaps reached a decade ago after the Asian financial crisis. The weekend summit had been set to expand it into a $120 billion fund to battle future financial crises.

Opponents of Thai Prime Minister Abhisit Vejjajiva stormed into the venue on the beach resort of Pattaya, forcing authorities to scrap the summit and evacuate foreign leaders, some of them by helicopter from the hotel roof.