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B316bn plan to jump-start economy

B316bn plan to jump-start economy

BANGKOK: The Cabinet yesterday (Aug 20) gave the green light to a B316-billion stimulus package deemed vital to boosting the country’s economic growth by 0.5-0.6 percentage points this year.

tourismeconomics
By Bangkok Post

Wednesday 21 August 2019, 08:21AM


Finance Minister Uttama Savanayana. Photo: Bangkok Post

Finance Minister Uttama Savanayana. Photo: Bangkok Post

According to Finance Minister Uttama Savanayana, the stimulus package consists of three main groups of measures: additional allowances to low-income earners and the elderly; a debt suspension scheme for farmers afflicted by the drought crisis; and efforts to mitigate the impact of the global slowdown on the Thai economy.

As part of the stimulus package, the Cabinet also agreed to extend until next April a measure that waives fees for visas on arrival issued to tourists from 19 countries. A waiver for 21 countries is due to expire on Oct 31.

The Cabinet rejected a contentious proposal to allow visa-free entry for visitors from China and India, citing security concerns.

Boost to GDP

The Fiscal Policy Office estimates that GDP growth will get a 0.5-percentage-point boost from the raft of stimulus measures, bringing Thailand’s growth to 3.5% this year.

Stripping out the economic stimulus package, the country's GDP growth would come in at 3% in 2019, compared with last year's 4.1%, said director-general Lavaron Sangsnit.

The latest forecast is based on an assumption that the country's exports will contract by 0.9% this year, he said.

The Finance Ministry's think tank in April downgraded the economic growth outlook to 3.8% from 4% as slower global growth took a toll on exports.

Tourist incentives

The Finance Ministry has prepared a budget of B19-20bn to fund the B1,000 giveaway for travel in tourism destinations outside of home provinces and a 15% cash rebate of up to B30,000 on tourism-related spending.

To be eligible for the B1,000 cash handout and rebate, Thais aged 18 and up are required to sign up at the Tourism Authority of Thailand’s website from Sept 23 to Nov 15.

The registrants will receive an SMS to confirm their privileges within three business days. They are then required to download the Pao Tang mobile app from Krungthai Bank (KTB) to receive B1,000 and the rebate to be paid by the government.

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In the event that registrants fail to use the B1,000 cash giveaway in identified provinces within two weeks of receiving the SMS, they cannot spend the money in the app.

For the cash rebate, registrants must transfer money to the Pao Tang app and spend on food, accommodation and One Tambon, One Product items at 100,000 shops equipped with electronic data capture (EDC) machines.

Registrants can spend up to B30,000 in any provinces outside their home province by Nov 30. They will receive the money back in the mobile app in December.

Cash splurge ready

Under the stimulus package, the Comptroller-General's Department will give additional allowances worth a combined B20bn to state welfare smartcard holders via e-wallet by early September, said director-general Suttirat Rattanachot.

Recipients are able to use the extra allowances to pay for consumer products at Thong Fah Pracharath shops equipped with EDC terminals or through the Tung Ngen mobile banking app; keep the money as savings; or make withdrawals at KTB ATMs.

Given that the additional allowance has no restrictions on the spending period, the money can be withdrawn and spent any time, Ms Suttirat said.

In addition, 14.6 million welfare recipients will receive an extra B500 monthly allowance during August to September; 5 million elderly who are welfare smartcard holders will get an extra B500 monthly allowance over the same period; and parents who are welfare recipients will receive B300 for each child for two months.

Kalin Sarasin, chairman of the Thai Chamber of Commerce, hailed the stimulus plan, saying it will deliver a boost to spending power, particularly for low-income earners. He said the tourism stimulus will help boost spending, particularly in the provinces.

Mr Kalin suggested state agencies hold more meetings in provincial areas to help distribute income to local residents.

 

Read original story here.

 

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