24-1-2024 (BANGKOK) Prime Minister Srettha Thavisin expressed concerns on Wednesday about the state of Thailand’s economy, stating that he believes it is currently in crisis. Thavisin, who also serves as the finance minister, announced that the government plans to implement a series of stimulus measures alongside financial handouts in an effort to bolster economic growth.
“I confirm that the economy is not doing well and is in crisis,” stated Mr Srettha during a press conference, acknowledging that there may be differing opinions, including those of the Bank of Thailand (BoT). The prime minister’s remarks came after BoT Governor Sethaput Suthiwartnarueput, in an interview with Reuters on Tuesday, expressed skepticism about the effectiveness of government stimulus in addressing the structural challenges facing Southeast Asia’s second-largest economy.
Despite the government’s recent reduction of the 2024 growth projections from 3.2% to 2.8%, citing weakened exports and a decline in foreign tourist arrivals, Governor Sethaput insisted that the economy is not in a state of crisis, contrary to the government’s portrayal. Sethaput, who has faced criticism from the prime minister for maintaining interest rates at a decade-high of 2.5% despite low inflation, argued that the slowdown in growth was within expected parameters.
Srettha, a former property tycoon now serving as prime minister, has been vocal about the negative impact of high interest rates on businesses. He has urged the Bank of Thailand to consider lowering interest rates as a means of stimulating economic activity.
The Pheu Thai-led coalition government, under Srettha’s leadership, has pledged an extensive array of stimulus measures to jumpstart the economy. This includes a substantial 500-billion-baht (US$13.9-billion) handout programme designed to benefit 50 million Thai citizens.
“Reducing interest rates is a central bank matter… but there will be more policies in addition to the digital wallet,”
