The economic prospects within the vibrant lands of Thailand are currently shrouded in a gloomy mist, necessitating a swift economic boost to halt its precipitous decline. This urgency forms the backdrop of heated debates regarding the true health of the nation’s economy. Detractors question the government’s proposed stimulus package- US$313 million dole-out strategy. This approach, however, necessitates incurring a formidable debt of US$15.6 billion.
The renowned scribe of the Thai Prime Minister, Prommin Lertsuriyadet, has put forward compelling signs of the slow-paced growth that Thailand treads on compared to its regional counterparts, an alarming rise in household debt being one of them. These indicators paint a grim picture, trapping the nation in the swirling winds of an economic storm-speeding headlong without any sign of abating. Should the government remain passive and allow the economy to sink or swim, we might be steering towards a precarious economic future, warns Prommin.
Envisioning every Thai as a cog in the larger economic wheel, Prommin enunciated the government’s commitment to sparking economic growth. Propelling this strategy is the touted US$313 million dole-out scheme, one supported by the trustworthiness of blockchain technology, considered the best bet for rejuvenating Thailand’s wilting economy. This state-of-the-art policy was announced amidst the buzzing whispers of the Parliament, as Prommin underscored the government’s unflinching dedication towards its application.
Countering the skepticism of a band of 99 academicians, including past governors of the Bank of Thailand, Surapong Suebwonglee, a national committee member on soft power development, came forward in staunch support of the digital currency hand-out. In a passionate piece penned in a Tuesday Facebook post, Surapong laid bare the somber facts—dismal GDP growth, restriction in monetary supply impacting liquidity, and snowballing household debts.
Invoking the analogy of a patient in distress, Surapong projects this year’s GDP growth to nose-dive under the 2% mark, contradicting earlier, slightly optimistic, forecasts. The previous year’s predictions by the Finance Ministry’s Fiscal Policy Office had suggested that this year’s GDP growth would hover around 3.85%, later adjusting it down to 2.7%. The Bank of Thailand had offered a slightly cheerier 2.8% prediction.
However, Surapong employs reason to disengage from this consensus. With the nation recording GDP growths of 2.6% and 1.8% respectively in the first two quarters of the year, he concedes that it is highly unlikely that the cumulative growth for 2023 could achieve the anticipated 2.8% mark.
He references freelance economist Chartchai Parasuk’s predictions, which forecast a slowed down third-quarter growth of 1.4%, or an overall annual growth of 1.8%. Surapong reminds us that GDP growth is inextricably entwined with the growth in money supply. A worrying deceleration from 3.3% and 2.0% in the first two quarters to 1.8% in the third quarter heralds serious concern, while a capital outflow of a staggering US$241.5 million within the initial three weeks of Halloween month creates added anxiety around achieving the forecasted 2.8% GDP growth.
Surapong concludes his insightful piece by presenting a note of concern about the ongoing liquidity crisis that has gripped Thailand since the middle of 2023. This predicament has led banks to throttle new lending, thus creating an excess liquidity deficit of an astounding US$26.8 billion in July which further ballooned to US$31.3 billion in August. This monetary spiral, made worse by substantial capital outflows and restrained lending, gave rise to a third concern- a dramatic increase in non-performing loans amounting to 7.4% of household debts registered since the second quarter.