Thailand set to ‘stir up’ the economy with juicy stimulus carrot
Thailand is gearing up to dangle a glittering economic carrot with a new stimulus package set to roll out by year’s end, stretching well into 2025. This ambitious plan aims to supercharge the country’s economy, injecting life into key sectors and rallying national growth.
In the corridors of power, Deputy Finance Minister Julapun Amornvivat revealed that the top-tier economic stimulus committee, chaired by Thai Prime Minister Paetongtarn Shinawatra, will gather tomorrow, November 19. High on the agenda? Unveiling a hefty stimulus package destined to kick off by late 2024.
Julapun highlighted the need for a meticulous timeline, indicating that the measures would call for cross-ministry collaboration to unleash a wave of economic activity through various channels.
“The stimulus measures may be divided by sector and will include the cash handout scheme.”
Julapun ever cautious about sealing all deals in a single sitting added that follow-up meetings are on the cards to track the package’s progress.
Diving into the nitty-gritty of funding, the pot will be filled from diverse sources. A slice comes from the government’s fiscal 2025 stimulus programme, with a cool 180 billion baht earmarked. Some projects won’t require budget allocations, with state financial institutions managing others through the Public Service Account.
Real estate market
Buoyant about Thailand’s economic prospects, especially in Q4, Julapun admitted that roadblocks remain, such as drooping pickup sales and a stagnant real estate market.
As the committee gets set to chew over phase two of the cash handout scheme, debt restructuring for retail borrowers is also in the spotlight. Expect to see measures like interest payment freezes and slashed monthly instalments. Plus, the Finance Ministry has plans afoot to allow financial institutions to trim their contributions to the Financial Institution Development Fund.
Bangkok Post reported that a part of these initiatives will be bankrolled by financial institutions themselves. But a potential sticking point is whether those involved in debt restructuring will still be able to access credit. Julapun firmly rebuffs any suggestion that more credit means spiralling debt and bad loans.
“Instead, the government sees greater access to credit as an opportunity for individuals to regain financial independence.”
Julapun added that there should be credit access for those in debt relief.
“We need to create mechanisms to make credit more accessible, such as reducing interest rates through soft loans, to provide more opportunities for people to access credit.”
This forthcoming stimulus package showcases the government’s go-getter attitude in the face of economic challenges, designed to cultivate growth and fuel prosperity across the land.
Frequently Asked Questions
Here are some common questions asked about this news.
Why is Thailand focusing on a multi-ministry collaboration for its economic stimulus?
Collaborating across ministries ensures a comprehensive approach, addressing diverse sector needs and leveraging various expertise for effective economic revitalization.
How might Thailand’s proposed debt restructuring impact individual financial stability?
By offering interest suspensions and reduced payments, the restructuring aims to alleviate financial burdens, potentially increasing borrowers’ long-term stability and credit access.
What if Thailand’s economic stimulus package doesn’t address real estate stagnation?
Ignoring real estate stagnation risks prolonged sectoral sluggishness, impacting employment and investment, and potentially hindering overall economic recovery.
How could greater access to credit reshape Thailand’s economic landscape?
Increased credit access could empower individuals financially, fostering entrepreneurial activities and boosting consumer spending, driving economic growth.
What are the potential risks of increasing credit access within a stimulus package?
While boosting credit access can spur growth, it risks escalating debt if not managed with robust financial literacy and repayment mechanisms.
