Thailand unveils 110 billion baht economic recovery plan
Thailand’s government rolled out a comprehensive economic recovery initiative, aiming to inject up to 110 billion baht into the economy by supporting small businesses through collaborations with major corporations.
This campaign, running from September to January, encompasses three main strategies: reducing expenses, generating income, and creating opportunities. The focus is primarily on small operators, who constitute 90% of the country’s businesses and form the backbone of the economy.
Prime Minister Paetongtarn Shinawatra, speaking at the launch event yesterday, October 16, reaffirmed the government’s dedication to revitalising economic activity. Last month’s 10,000-baht (US$300) cash handout was highlighted as a crucial measure to enhance consumer spending and foster business opportunities.
“The government expects the initiative to stimulate the economy by as much as 110 billion baht (US$3.3 billion),” Paetongtarn stated, emphasising the vital role of the public sector in driving this policy while the private sector aids its execution.
To cut costs, the government has partnered with state agencies and businesses to lower rental fees for operators leasing space from state agencies and participating companies. In Bangkok, 12 market operators collaborating with the Bangkok Metropolitan Administration have agreed to halve rental fees for approximately 11,000 vendors until the end of this year.
Additionally, the Commerce Ministry and other state agencies will waive rental fees for over 3,000 vendors. Thailand Post and its partners are also set to reduce transport costs, recognising rental fees and transport as significant business expenses.
Economic recovery
The 38 year old Thai premier indicated plans to increase marketplaces for small operators, with the Defence and Interior Ministries converting areas at military bases and provincial halls into markets. This initiative aims to create over 1,300 marketplaces nationwide.
The government is also working with major manufacturers and wholesalers to lower consumer goods prices and organise discount events. Over 130 operators with more than 100,000 branches are participating in this scheme. The prime minister assured that both short-term and long-term plans are in the pipeline to bolster the economy further.
The launch saw the involvement of Deputy Prime Minister Phumtham Wechayachai, Commerce Minister Pichai Naripthaphan, Deputy Commerce Minister Suchart Chomklin, and private sector representatives from CP Group, The Mall Group, BJC, Big C, PT, PTT Oil and Retail Business Plc, Sea Value, Thai Union, and OSOTSPA.
Commerce Minister Pichai highlighted that the economic recovery campaign aligns with the premier’s strategy to rejuvenate the economy following significant investments in various sectors. Last year, electronic circuit board investments totalled 150 billion baht (US$4.5 billion), while this year saw 160 billion baht (US$4.8 billion) in data centre investments, excluding 30 billion baht (US$902 million) from Google and another 30 billion baht from the UAE.
Pichai also noted that Paetongtarn’s recent visits to Qatar and Laos attracted investment interests in various sectors, including food security. The projected 110-billion-baht economic boost is expected to derive from three main sources.
Increased spending among vulnerable groups who received the 10,000 baht cash handout is set to contribute 78.7 billion baht (US$2.4 billion), with an estimated 54% of the handout being spent on discounted items under the economic recovery project.
An additional 18.7 billion baht (US$562 million) is anticipated from reducing business costs and creating opportunities for small operators through festivals and special activities designed to stimulate spending. The remaining 14.4 billion baht (US$433 million) is projected to come from sales events at department stores, retail and wholesale outlets, and price discounts from manufacturers, reported Bangkok Post.
Meanwhile, KKP Research has revised its economic forecast for 2024, raising the GDP projection from 2.6% to 2.8%, and for 2025, from 2.8% to 3.0%.
