The Prime Minister of Thailand, Paetongtarn Shinawatra, announced the launch of a nationwide economic recovery program aimed at increasing the economy by 110 billion baht (US$3.3 billion) by year-end.
The economic recovery campaign focuses on increasing income, decreasing expenses, and creating opportunities for small operators, who make up 90% of the country’s commercial operations and drive the economy.
During yesterday’s luncheon, Prime Minister Paetongtarn Shinawatra confirmed the government’s commitment to economic growth. She cited last month’s 10,000-baht cash giveaway as a vital step to boost consumer spending and business prospects.
She stated, “The government expects the initiative to stimulate the economy by as much as 110 billion baht,” with the public sector leading the strategy and the private sector providing support.
To cut costs, the government has asked state agencies and corporations to reduce rental fees for operators using state-owned and participating company venues. Twelve market operators working with the Bangkok Metropolitan Administration will lower rental rates for 11,000 sellers until year-end.
The Commerce Ministry and other state agencies will waive rental fees for over 3,000 vendors, while Thailand Post and collaborating partners will lower transit expenses.
She mentioned that the Defence and Interior Ministries will also transform vacant lands on military bases and provincial halls into markets for small enterprises. More than 1,300 marketplaces will open nationwide.
The government collaborates with key manufacturers and distributors to reduce consumer goods prices and hold discount events. Over 130 operators with over 100,000 branches will participate, and the government will implement short- and long-term economic stimulus programs.
Bank of Thailand Rate Cut
On Wednesday, the Bank of Thailand unexpectedly lowered rates by 25 basis points to 2.25%. The central bank’s Monetary Policy Committee cut the one-day repurchase rate by 25 basis points to 2.25%. The rate was 2.50% since September 2023, a 10-year high.
The policy rate increased by 25 basis points last September. The central bank last reduced rates in May 2020 due to the COVID-19 pandemic.
The Pheu Thai government has pressed the central bank to lower borrowing costs for months to boost the struggling Thai economy. The Finance Minister stated that inflation has remained below the central bank’s 1-3% target for several months.
Meanwhile, Thai Chamber of Commerce chairman Sanan Angubolkul said decreasing borrowing costs will benefit businesses facing high expenses and a strong baht. Today’s Thai Baht to US Dollar exchange rate is 1 THB = 0.03014 USD.
The local currency rose 14% in the third quarter, making exports more expensive than those of competitors. Recently, it weakened. The drop in rate should encourage the tourism industry to invest and modernize services to enhance competitiveness and increase tourist spending.
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