Handout to lift GDP by 0.3 percentage points
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Handout to lift GDP by 0.3 percentage points

Effects set to extend into next year's Q1

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People eligible for the cash handout scheme wait to withdraw cash from a branch of Government Savings Bank in Chachoengsao's Sanam Chai Khet district.
People eligible for the cash handout scheme wait to withdraw cash from a branch of Government Savings Bank in Chachoengsao's Sanam Chai Khet district.

The government's first phase of the cash handout scheme, amounting to 145 billion baht, is expected to help stimulate the economy this year, raising GDP by 0.3 percentage points, with the momentum extending into the first quarter of next year, says Deputy Finance Minister Paopoom Rojanasakul.

The government is preparing more stimulus measures to maintain the economic growth momentum, which will encourage spending towards the end of this year, he said.

According to Mr Paopoom, the government initially expected GDP growth this year of 2.6-2.7% excluding the stimulus scheme.

The 10,000-baht handout to recipients should result in additional economic growth of 0.3 percentage points, with effects likely extending into early next year, he said.

"The economy could grow more than the forecast of 2.7% this year," said Mr Paopoom.

Regarding the country's economic prospects for next year, he said there is positive momentum for continued economic growth driven by this year's stimulus measures.

In addition to the one-time payment, the government recently implemented various economic measures that should benefit low-income earners, with positive effects likely to last into the first quarter of next year, said Mr Paopoom.

Further stimulus measures might be introduced during the first quarter, he said.

In the longer term, Mr Paopoom said the government needs to entice more investors, develop infrastructure and provide loans for small businesses in order to push GDP growth to 3%.

He said year-end stimulus programmes are likely, including tax measures and spending incentives. However, Mr Paopoom confirmed the year-end measures will not be a repeat of the previous "half-half" co-payment scheme.

Measures such as purchase-based tax deductions are under consideration, he said.

"Announcing them too early might delay spending in December, but the government is preparing tools and will implement them by the end of the year," said Mr Paopoom.

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