State readies fresh stimulus
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State readies fresh stimulus

Village Funds to get additional budget

The government vows to continue introducing additional measures to improve the economy in the first and second quarters.

Deputy Prime Minister Somkid Jatusripitak said fresh measures include a higher budget for Village Funds, soft loans for water resource development and a new phase of the Taste-Shop-Spend stimulus scheme.

"The country's economic growth in the fourth quarter last year may not have reached 2% as expected because of a troubled export sector hit by the continued trade war and a delay in the fiscal 2020 budget, while growth is unlikely to exceed 1% in the first quarter this year due to the coronavirus outbreak, which undermined tourism," Mr Somkid said. "More stimulus measures are still needed."

The National Economic and Social Development Council is scheduled to unveil the GDP reading for the fourth quarter and a revised outlook for 2020 on Feb 17.

According to Mr Somkid, additional funding for Village Funds will be channelled through the Bank for Agriculture and Agricultural Cooperatives and Government Savings Bank. The new funding is in addition to the 99 billion baht the government last month budgeted for Village Funds this year to beef up the local economy.

The 99-billion-baht plan includes 14 billion baht for projects and 75 billion baht in debt suspension for members of the National Village and Community Fund.

The cabinet on Nov 26 approved 144 billion baht in stimulus measures, aiming to boost full-year economic growth to 2.8% and maintain momentum in the first quarter.

The measures include an allocation of 200,000 baht each to 71,742 Village Funds nationwide, worth some 14 billion baht.

There are 79,585 Village Funds with 13 million members. The office expects 1.5 million members to ask for the debt suspension programme.

More details about the new funding to the Village Funds were not disclosed, with Mr Somkid saying only that the injection of additional budget will help boost the Thai economy and create jobs.

He said the Village Funds should invest more in projects such as reservoirs, small dams, community tourism spots, rice mills and machinery to process farm products.

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