Thailand’s Economic Stability: Navigating Funding Challenges for Growth and Handout Programs

Thai Prime Minister considers funding options for $13.7 billion stimulus package to bolster economy

The Thai government has announced that it will delay the distribution of funds for a proposed handout scheme worth 500 billion baht ($13.7 billion). The “digital wallet” plan involves transferring 10,000 baht ($275) to 50 million Thais to be spent within six months. However, concerns about the funding for this scheme have arisen, with some experts questioning its fiscal responsibility.

The government has revised its 2024 growth outlook due to unexpected contraction in the final quarter of 2023 and full-year growth at only 1.9%, below the projected 2.5% growth in 2023. The state planning agency now projects a range of growth from 2.2% to 3.2%, down from the previous estimate of 2.7% to 3.7%. Srettha has revealed that the finance ministry and Budget Bureau are exploring potential funding sources for the scheme, including a borrowing bill.

While the government has approved the budget for the 2024 fiscal year, it faces challenges in seeking a borrowing bill to finance the handout program. The Central Bank Governor has expressed concerns about slower-than-expected growth and structural issues in the economy, but Srettha has labeled this as a crisis that requires urgent stimulus measures.

Srettha also announced that there would be no changes made to other government programs or policies until further notice due to uncertainty about funding sources for the handout scheme’s implementation. He emphasized that his primary concern is boosting economic growth and ensuring stability in Thailand’s financial system.

The government’s decision to delay funding for this scheme reflects their commitment to finding sustainable solutions that ensure long-term economic stability rather than relying on short-term fixes.

In conclusion, while there are concerns about funding sources for this scheme, Prime Minister Srettha remains committed to finding sustainable solutions that will boost economic growth and ensure stability in Thailand’s financial system.

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