Government adamant on growth target of 4% this year

Government adamant on growth target of 4% this year

The government has pledged to revitalise tourism, stimulate domestic spending, and spur exports and investment to help economic growth reach its 4% target this year.

Deputy Prime Minister Supattanapong Punmeechaow said the government still maintains an economic growth target of 4% this year although various economic forecasting agencies have downgraded their outlook to only 2.7-3% growth.

The Fiscal Policy Office recently slashed Thailand's economic growth forecast to 2.8% this year, down from 4.5% in October 2020, while the Joint Standing Committee on Commerce, Industry and Banking maintained its economic outlook on Wednesday at 1.5-3.5%, despite distribution of the Covid vaccine.

According to Mr Supattanapong, three factors -- exports, domestic tourism and the government's stimulus measures -- will help speed up Thai economic growth in the remaining 10 months.

Exports in particular are expected to recover to growth this year, driven by rising world trade and a recovering global economy, he said.

The National Economic and Social Development Council in February upgraded its export growth forecast to 5.8%, an increase from a 4.2% expansion in the previous projection in November last year, despite downgrading its economic growth forecast for this year to 2.5-3.5% from 3.5-4.5%, mainly because of a fresh wave of infections.

Thailand's exports, notably those bound for emerging markets, should be sped up, said Mr Supattanapong.

He said the government also aims to stimulate domestic tourism as fast as possible to generate income for the country.

Domestic tourism revenue fell substantially to 600 billion baht in 2020, down from 1 trillion in 2019, because of the pandemic.

To boost domestic tourism, Mr Supattanapong said the government looks set to implement additional stimulus measures to increase activities.

The government also expects the "Section 33 Rao Rak Kan" (We Love Each Other) financial relief measures will help drive domestic spending in the second quarter this year, he said.

Registration for We Love Each Other is scheduled to run from Feb 21 until March 7, with approved applicants required to confirm via the Pao Tang app from March 15–21. Those eligible for the aid receive a 4,000-baht subsidy via the app, followed by 1,000 baht a week from March 22-April 12.

Those who are rejected can appeal via the website and apply from March 15-28, said the Labour Ministry.

More than 11 million workers are covered by the social security system under Section 33 of the Social Security Act.

Mr Supattanapong said new measures may include another phase of the co-payment subsidy programme and the "We Travel Together" stimulus campaign.

The government also plans to reduce corporate income tax to lure investors to invest in regional operating headquarters.

He said the government pledged to rejig existing regulations on smart visas, immigration procedures and work permits to draw more foreign investment.

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