Cabinet gives green light to B1.9tn stimulus

Cabinet gives green light to B1.9tn stimulus

B5,000 monthly handouts extended to six months from three

Wage-earners prepare for daily work in Min Buri district, Bangkok. The government on Tuesday planned to spend 1.9 trillion baht to help people and businesses affected by the virus outbreak. (Bangkok Post file photo)
Wage-earners prepare for daily work in Min Buri district, Bangkok. The government on Tuesday planned to spend 1.9 trillion baht to help people and businesses affected by the virus outbreak. (Bangkok Post file photo)

The cabinet on Tuesday approved 1.9-trillion-baht spending to help people and businesses affected by the coronavirus disease 2019 (Covid-19), including 600 billion baht for six-month cash giveaways and 500-billion-baht soft loans for small and medium-sized businesses.

The package, the third phase of the stimulus programme to shore up the economy, will be backed by three executive decrees.

The first decree will allow the government to borrow 1 trillion baht from May this year to September next year. 

Of the amount, 600 billion baht will go to implementing health-related plans and giving financial aid to affected people. This includes the 5,000-baht monthly handouts to an estimated 9 million self-employed and laid-off people affected by the outbreak, which will be extended to six months from three previously.

The portion also includes financial aid for farmers which has yet to be announced.

The remaining 400 billion baht will go to economic and social rehabilitation through projects aimed at creating jobs, strengthening communities and building commuity infrastructure.

Another executive decree will allow the Bank of Thailand to extend 500-billion-baht soft loans with a 2% annual interest rate to SMEs, with a credit line not more than 500 million baht each.

Commercial banks and specialised financial institutions will also give SMEs with a credit line not more than 100 million baht each a six-month debt moratorium on both principal and interest.

The other executive decree will stabilise the financial market by setting up the 400-billion-baht Corporate Bond Liquidity Stabilization Fund (BSF) in which the central bank can buy corporate bonds to keep liquidity flowing.

In addition to the three decrees, Prime Minister Prayut Chan-o-cha said the cabinet approved a bill on the redistribution of 3.2-trillion-baht budget to be sent it to the House and Senate for approval when Parliament reopens in early June.

He said the fiscal 2020 budget of each ministry would be trimmed and the proceeds, expected at 80-100 billion baht, would also be used for the relief.


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