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Thailand Implements Measures to Boost Economic Growth to 3%

The Thai government has unveiled three immediate measures to bolster the nation’s economic growth to 3% this year, up from the initially forecasted 2.4%, announced Finance Minister Pichai Chunhavajira on June 10, 2024.

The economic ministers of the Thai cabinet have adopted three short-term strategies aimed at enhancing the country’s economic growth rate to 3% this year, from an initial projection of 2.4% by the Fiscal Policy Office. Finance Minister Pichai Chunhavajira disclosed these plans following a meeting at Government House.

Thailand’s GDP growth in the first quarter of the year stood at a mere 1.5%, the lowest among the ten ASEAN member countries. This lackluster performance has prompted urgent measures to stimulate the economy.

The first strategy focuses on increasing foreign arrivals. The government aims to attract an additional one million tourists this year, raising the total to 36.7 million. This influx is expected to boost GDP by 0.12%, according to the finance minister.

The second strategy involves accelerating the disbursement of the remaining 850 billion baht from the 2024 fiscal budget, with 20% earmarked for investment. Pichai noted that 41% of the investment budget has already been utilized. By ensuring that 70% of the remaining funds are spent within the year, the GDP could see a 0.24% rise.

The final strategy urges private investors, particularly those who have received incentives from the Board of Investment, to expedite their projects. If investments totaling 40 billion baht are realized this year, Thailand’s GDP could grow by an additional 0.14% to 0.15%.

In addition to these measures, the economic ministers are also considering support for SMEs impacted by the COVID-19 pandemic. The Government Savings Bank has been instructed to offer low-interest loans to affected businesses through commercial banks. To facilitate this, a new measure to be introduced tomorrow will involve the Thai Credit Guarantee Corporation guaranteeing approximately 50 billion baht in credit to help SMEs.

Regarding the issue of falling oil palm prices, the ministries of Agriculture, Commerce, and Energy have been tasked with conducting a market study. Following this, a meeting with palm oil producers will be held to devise a solution that ensures fair prices for farmers. Discussions will also be arranged between farmers’ representatives and biodiesel producers to agree on oil palm pricing.

The economic ministers also reviewed a report from the Labour Ministry on rising unemployment, driven by mass layoffs from factory closures amidst the sluggish economy. The report highlighted that up to half a million employees have already lost their jobs, with an additional 100,000 graduates entering the job market this year, many of whom may also face unemployment.

In attendance at the meeting were several key officials, including representatives from the Ministry of Labour, the Ministry of Agriculture, and various other governmental and financial institutions, who collectively worked towards addressing these pressing economic challenges.

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