Thai GDP growth of 5% is likely this year if the global economy's performance and state spending outpace expectations, the Finance Ministry says.
The country can see economic growth of 5% in the event that global growth comes in at 4.28%, the number of foreign tourists visiting Thailand hits 40 million, the baht is weaker than 32.25 to the US dollar on average, and more than 61% of the state investment budget is disbursed, said Finance Ministry spokeswoman Kulaya Tantitemit.
According to the latest Fiscal Policy Office (FPO) forecast released Thursday, the world economy will grow by 4% and the number of foreign tourists will stand at 39.5 million this year.
Deputy Prime Minister Somkid Jatusripitak recently said that he wanted to see the economy expand 5% this year. The economy grew at its best quarterly pace in five years in the first quarter at 4.8%.
Ms Kulaya said that at least 170 billion baht must be injected into the economy to produce 5% growth.
However, the FPO's forecast for 4.5% growth this year has not taken into account the additional 165-billion-baht economic stimulus package recently approved by the cabinet.
The package includes credit guarantees for small and medium-sized enterprises under the Thai Credit Guarantee Corporation's Portfolio Guarantee Scheme 7 and financial aid for farmers to stabilise rice prices, Ms Kulaya said.
Regarding the living allowance to 11.4 million low-income earners, she said the 59-billion-baht budget for fiscal 2018 has been accounted for in the FPO's latest forecast.
For the October-to-June period, the government spent 31 billion baht to subsidise the government's welfare cardholders. The government has set a 42.7-billion-baht budget for the living allowance to low-income earners in fiscal 2019, starting from October 2018.
The government is giving a monthly living allowance of 200-300 baht to 11.4 million people earning under 100,000 baht a year to buy staples at Thong Fah Pracha Rat shops. Those who participate in the government-sponsored job training programme receive an additional living allowance of 100-200 baht a month. Each cardholder also receives a transport subsidy of 1,500 baht per month for inter-provincial public buses, third-class trains, local public buses and electric trains.
Some 5.3 million out of 11.4 million recipients of the government's welfare and subsidy scheme are living below the national poverty line, set at 30,000 baht a year.
The FPO officially upgraded the country's economic outlook to 4.5% from 4.2% predicted in April. Its latest forecast is a bit higher than the Bank of Thailand's 4.4% growth forecast and in between the National Economic and Social Development's forecast of 4.2-4.7%.
The Finance Ministry's think tank also raised the country's 2018 export growth forecast to 9.7% from 8% predicted three months ago.
The forecast for this year's private consumption and investment growth was bumped up to 3.8% and 3.9% from 3.5% and 3.8%, respectively, but the FPO slightly cut the estimate for public consumption and investment to 2.9% and 7.9% from 3% and 8.9%, respectively.
The FPO forecast that the Monetary Policy Committee will keep the policy rate on hold at 1.5% throughout this year, and headline inflation is predicted to hover around the lower end of the central bank's inflation target range of 1-4%.
