Thailand will be able to borrow to finance its 500-billion-baht digital wallet handout scheme in accordance with Section 53 and 57 of the 2018 State Fiscal and Financial Discipline Act, following an endorsement by the Council of State, says Julapun Amornvivat, the deputy finance minister.
Section 53 of the 2018 State Fiscal and Financial Discipline Act stipulates that the taking of loans by the government for reasons other than those provided in the law on public debt administration is permissible, provided that the Ministry of Finance shall do so only by virtue of the law specifically enacted and only in the case where there occurs a need for action to be taken urgently and continually to resolve critical problems, where annual appropriations cannot be fixed in due time.
Section 57 stipulates that loans under Section 53 and Section 56 shall be made only for funding plans or projects of economic or social value for money and where the state agencies responsible therefore possess readiness for the pursuit of the plans or projects to be funded by such loans.
Following the vetting by the Council of State, the second meeting of the digital wallet policy committee is scheduled to convene next week with the prime minister as chairman to consider approving the implementation plan to be launched within the previous timeframe or by May this year. At present, the government has submitted its draft of the loan bill for a legal review.
Apart from Section 53 and Section 57, Mr Julapun added that the implementation of the scheme requires pre- and post-evaluation as well as being open to a public hearing from all sides.
The government emphasised the need to stimulate the economy through its digital wallet scheme by saying that the country's economy is in a state of a crisis as it expanded at an average rate of 1.9% per year over the past decade.
With regard to interest rates, Mr Julapun said that in the recent past the Finance Ministry ordered the state financial institutions to maintain interest rates unchanged for as long as possible, which lasted until the end of last year.
He also expressed concern over the Bank of Thailand's policy rate hikes, which resulted in a decline in the rate of inflation over the past three months. This situation is being closely monitored by the Finance Ministry.
He declined to comment regarding the policy rate cut, saying it was not within his authority. In the meantime, he said the prime minister was in talks with the Bank of Thailand from time to time.
He said the decrease in the rate of inflation indicated that the economy was slowing down and it was the responsibility of the government to stimulate the economy to ensure the well-being of the people.
