The cabinet has given the green light to an additional 276 billion baht in borrowing for the 2024 fiscal year, with 269 billion designated for direct government use and debt restructuring for state enterprises.
This decision will bring the total new borrowing for the fiscal year ending on Sept 30 to 1 trillion baht, as conveyed by deputy government spokeswoman Rudklao Intawong Suwankiri during a news briefing on Tuesday.
Furthermore, ministers endorsed a proposal from the Ministry of Finance to revise the public debt management plan for fiscal 2024, as stated by Mrs. Rudklao.
Following this adjustment, the public debt-to-GDP ratio is projected to remain at 65.1%, staying below the set framework ceiling of 70% of GDP, she added.
As of the end of May, the debt-to-GDP ratio stood at 64.3%, an increase from the prior month’s 63.8%.
Acknowledging the intended use of the additional borrowing, government spokesman Chai Wacharonke mentioned that it will support the 10,000-baht digital wallet distribution, set to commence in the fourth quarter at an estimated cost of 500 billion baht.
The digital wallet initiative, aimed at benefiting 50 million Thai citizens and to be spent locally, is a cornerstone of Prime Minister Srettha Thavisin’s strategy to bolster the economy which has seen sub-2% average growth in the past decade.
However, the plan has faced opposition from the Bank of Thailand (BoT) and some economists due to potential inflationary and fiscal impacts, with recommendations to restrict the benefit to the truly needy estimated at 16 million individuals.
In a bid to finance the stimulus program, the cabinet had previously approved a plan to boost the fiscal 2024 budget by 122 billion baht in May.
Mrs. Rudklao noted that the revised public debt plan encompasses a net increase in new borrowing amounting to 276 billion baht, pushing the total to 1.03 trillion.
She elaborated on the allocated funds for state enterprises, including the State Railway of Thailand, for investment in development projects and debt restructuring, with an additional borrowing of 3.47 billion baht from domestic sources.
This new borrowing forms part of a larger revision to the debt management plan encompassing existing debt and repayments, with notable increases in domestic debt management and planned restructuring efforts.
