Fresh economic stimulus measures are likely to be unveiled later this year in a last-ditch effort to boost full-year economic growth after the third quarter turned out soft figures.
The Finance Ministry is mulling aid measures for several sectors and such measures must help revive the domestic economy and consumption, particularly for small and medium-sized enterprises (SMEs), said Finance Minister Uttama Savanayana.
“The ministry is closely monitoring the economic situation. A new stimulus package is possible, and if it is rolled out ahead of year-end, this will be a New Year’s gift to the public,” he said.
The economic growth reading of 2.4% year-on-year in the third quarter prompted the National Economic and Social Development Council to slash its 2019 GDP forecast again to 2.6% — from an earlier projection of 2.7%-3.2%, while Mr Uttama recently admitted growth is unlikely to reach 2.8% as predicted by the Finance Ministry.
Stimuli are necessary during these trying times, he said, as each sector can tolerate the economic slowdown to varying degrees, but the farming sector and SMEs require assistance.
The global economic slowdown has taken a toll on exports, which make up 70% of Thailand’s GDP, said Mr Uttama.
The root of the problem is that the country’s manufacturers still produce conventional products that are difficult to sell under current circumstances and this hurts employment and weakens local purchasing power, he said.
Mr Uttama said both local and foreign investors have expressed confidence in the Eastern Economic Corridor (EEC) after basic infrastructure there has made strides.
The EEC must be aggressively promoted to convince both Thai and foreign investors to kick-start their investment in the corridor and the most important issue is that they will bring in new technologies to help sustain the country’s growth, he said.
The EEC is the government’s flagship investment scheme, spanning the eastern provinces of Chon Buri, Rayong and Chachoengsao. The government aims for the corridor to be home to the 12 targeted industries.
Thailand is at an inflection point to catch up with the new economy, said Mr Uttama, and if it can adapt via the EEC the country can move forward.