27-12-2023 (BANGKOK) Thailand is gearing up for a larger budget deficit of 713 billion baht (US$20.71 billion) for the fiscal year 2025, accompanied by higher spending of 3.6 trillion baht, according to a government statement released on Dec 26. The cabinet approved the plans on the same day, although details were not fully disclosed in an active manner.
The government justifies the proposed budget, citing the need for a short-term deficit to support ongoing economic expansion and stability. The plan anticipates a GDP growth rate of 3.6% in 2025, with the fiscal year commencing on Oct 1, 2024.
Inflation projections for 2025 range between 1.5% and 2.5%, and the plan envisions a public-debt-to-GDP ratio of 63.73% at the conclusion of the 2025 fiscal year.
Compared to the 2024 fiscal year, where spending is set to rise from 2023, the 2025 budget plan outlines an increase in spending from 3.48 trillion baht. The deficit is expected to rise in 2025, following a minor drop projected in the 2024 draft budget.
The delay in the 2024 budget, originally scheduled to commence on Oct 1, 2023, was attributed to a May election and an extended period under a caretaker government. The cabinet recently approved the draft budget bill for the 2024 fiscal year, which is set to undergo its first reading in parliament next week.
