The Finance Ministry looks set to implement debt restructuring measures for individuals to help increase their disposable income.
Finance Minister Pichai Chunhavajira said on Tuesday one short-term stimulus measure prepared by the ministry aims to increase disposable income through debt restructuring at both public and private banks. The Bank of Thailand already signed on to this idea, he said.
"The measures we prepared will help people have more money in their pockets for spending. One approach is to reduce the debt repayment burden and extend the repayment period, which the central bank agrees with," said Mr Pichai.
Deputy Finance Minister Julapun Amornvivat said the ministry plans to use off-budget funds to avoid a budgetary burden. The ministry estimates 10 billion baht can be drawn from off-budget funds, which total around 1 trillion baht.
In a related development, the cabinet meeting on Tuesday approved the revision of the medium-term fiscal plan (2025-27), as endorsed by the State Fiscal and Financial Policy Committee. This new framework was adjusted after the government prepared an additional budget expenditure act (mid-year budget 2024) totalling 122 billion baht.
The new plan results in a slight increase of about 0.5% in the public debt ratio by the end of fiscal 2024, which remains within the fiscal discipline framework.
Prime Minister Srettha Thavisin called a meeting with ministers in charge of the economy on Monday following the National Economic and Social Development Council (NESDC) reporting growth of 1.5% year-on-year for the first quarter.
The NESDC now expects GDP growth of 2-3% this year, slightly lower than its previous forecast of 2.2-3.2%.
The downgrade was attributed to high levels of external risk, especially trade protectionism, geopolitical conflicts and volatility in the global economy.
Thai growth in the first quarter lagged six regional peers: the Philippines and Vietnam led with 5.7% each, followed by Indonesia (5.1%), Malaysia (4.2%) and Singapore (2.7%).