Thai Cabinet Approves Stimulus Package to Help Boost Economic Growth
A 316-billion baht stimulus package was given the green light on Tuesday by the cabinet. The packaged is touted as vital to boosting the country’s economic growth this year by 0.5 – 0.6 percentage.
The stimulus package consists of three main groups, according to Finance Minister Uttama Savanayana. These groups are a debt suspension scheme for farmers afflicted the drought crisis; additional allowances to low-income earners and the elderly; and efforts to reduce the consequences of the global slowdown on the Thai economy.
The cabinet also agreed to extend a measure that waives fees for visa on arrival issued to tourist from 19 countries until the end of April 2020 This waiver was due to expires on October 31.
The proposal to allow visa-free entry for visitors from China and India was rejected. Security concerns were cited.
The group of stimulus measure is expected to boost the GDP 0.5 percent, bringing Thailand’s growth to 3.5% this year according to the Fiscal Policy Office.
Without the economic stimulus package it is estimated that the country’s 2019 GDP growth would end at 3%, compared to 4.1% for 2018, said director-general Lavaron Sangsnit.
He also added that the latest forecast is based on the expectation that the country’s exports will decline by 0.9% this year.
In April the economic growth outlook was downgraded to 3.8% from 4% by the Finance Ministry’s think tank as slower global growth affected Thai exports.
A budget of 19-20 billion baht has been prepared by the Finance Ministry to fund the 1,000-baht giveaway for travel to tourism destinations outside of home provinces. In addition tourism-related spending is being offered a 15% cash rebate of up to 30,000 baht.
Thais aged 18 and up need to sign up at the Tourism Authority of Thailand’s website from September 23 to November 15 to be eligible for this program.
To confirm their privileges the registrants will receive an SMS within three business days. To receive the 1,000 baht rebate to be paid by the government they will need to download the Pao Tang mobile app from Krungthai Bank (KTB).
The registrants will need to use the 1,000 baht cash giveaway in identified provinces within two week of receiving the SMS. If not used within that time period they cannot spend the money in the app.
Registrants must transfer money to the Pao Tang app for the cash rebate. This money will need to be spent on food, lodging and One Tambon One products at 100,000 shops that are equipped with electronic data capture machines (EDC).
Up to 30,000 baht can be spent in any provinces outside their home province by November 30. The money will be refunded in the mobile app sometime in December.
The Comptroller-General’s Department will give additional allowances under the stimulus package worth a combination of 20 billion baht. This will include state welfare smartcard holders via e-wallet by early September, said director-general Suttirat Rattanachot.
The extra allowances can be used to pay for consumer goods at Thong Fah Pracharath shops equipped with EDC terminals or through the Tung Ngen mobile banking app. They can also keep the money as savings or make withdrawals at KTB ATMs.
There are no restrictions on the time period to spend the money, said Ms. Suttirate, and the money can be withdrawn or spent anytime.
Also, during August to September 5, over 14.6 million welfare recipients will receive an extra 500-baht monthly allowance. These include five million elderly who are welfare smartcard holders. For two months in August and September parents who are welfare recipients will receive an additional 300 baht for each child.
The stimulus plan was hailed by Kalin Sarasin, chairman of the Thai Chamber of Commerce, stating that the plan will deliver a hike in spending particularly in low-income earners. In addition the tourism package will help build up spending in local provinces.
Mr Kalin suggested state agencies hold more meetings in provincial areas to help distribute income to local residents.