Business leaders breathed a sigh of relief yesterday after the Constitution Court endorsed the legitimacy of the fiscal-2014 budget bill, which allows the government to start spending money.
Government spending is seen as the only remaining economic driver now that exports and consumer spending are losing steam.
The eight-member court unanimously voted yesterday afternoon that the bill does not breach the Constitution.
Payungsak Chartsutthipol, chairman of the Federation of Thai Industries (FTI), said the private sector is relieved the bill can now take effect, as it will help the economy to move forward.
"I talked to many people who were concerned the bill might be blocked, which would have hit the economy hard," he said.
Deputy FTI secretary-general Korrakod Padungjitt said the budget law passage will help the economy and bolster domestic consumption, especially when exports are projected to be sluggish this year.
"Last year, the economy was good, not because of exports but rather government projects such as the first-time car and homebuyer schemes, which boosted domestic consumption," he said.
Mr Korrakod also urged the government to speed up conducting environmental and health impact assessments for next year's large projects that require them.
Early preparation will allow time for better communication with the public and propagate proper knowledge about the projects, thereby minimising opposition.
He cited as an example the Mae Wong dam project, which is ready in terms of funds but fails to win public approval.
"And the reports must be done comprehensively and neatly to ensure you gain public acceptance," said Mr Korrakod.
Isara Vongkusolkit, chairman of the Thai Chamber of Commerce, hailed the verdict, saying the court's ruling will allow the government to proceed with the budget disbursement and investment plans.
The ruling also helped the Thai stock market to pare some early losses, weighed down by worries over the US budget and the looming debt ceiling impasses.
"The Thai stock market's upside is fairly capped, while downside risk is going to be enormous," said Tisco Securities vice-president Apichat Poobunjirdkul.
However, he believes Congress will eventually reach agreement on both the US budget and the debt ceiling, as these issues are "too big to fail".
However, Mathee Supapongse, the Bank of Thailand's senior director for macroeconomic and monetary policy, said the court's ruling cannot boost consumer confidence and private investment, as it was in line with market expectations.