Thailand: $800 million in new cash handout to spur growth

Thailand’s government plans to inject more cash to push growth beyond 3 per cent this year, as the export-reliant economy faces headwinds from global trade tensions and a volatile local currency. 

The country’s economic stimulus panel approved the third phase of the government’s flagship cash handout plan.

The latest tranche is worth 27 billion baht ($800 million), which will be distributed toward the middle of the year to Thais aged 16 to 20, Finance Minister Pichai Chunhavajira told reporters after a meeting Monday. 

About 2.7 million beneficiaries in the age group will receive 10,000 baht each, with the disbursement set to be made through a new “digital wallet” application meant to boost spending, the minister said. The plan will require approval from the cabinet. 

“The cash handout will be spread out across the country and ease household debt burdens,” Pichai told reporters. “The government thinks the scheme will be worth it.” 

The stimulus is the centerpiece of Prime Minister Paetongtarn Shinawatra’s efforts to revive an economy that grew 2.5% in 2024, about half the pace of neighboring Indonesia. Thailand’s economic growth is weighed down by high household debt levels that hurt private consumption and remain the highest in region at 89.6% of GDP. 

Thailand runs a trade surplus of around $35 billion with the US, its second-largest trading partner, and faces risks of reciprocal tariffs from the Trump administration. 

“The Ministry of Finance estimates that the Thai economy will grow by 3% this year, but the government believes that the figure should exceed that,” Paetongtarn said in a post on X earlier Monday. 

The handout plan would follow 145 billion baht already paid out to 14.5 million state welfare card holders and people with disabilities late last year, and 30 billion baht to about 3 million senior citizens earlier this year. 

Pichai also said the government has prepared some 46 fiscal projects to stimulate economic growth this year, including boosting public spending to over 70% of the budget outlay and accelerating exports by more than 4%. The government also plans to spur tourism, another major driver of growth. 

Pichai reiterated calls for a weaker baht to support tourism and exports. The Thai currency has gained about 4.8% against the dollar in the past year to emerge as the second-best performer in Asia — prompting calls from business groups, exporters and tourism operators to weaken the currency and curb its volatility. 

The Bank of Thailand surprised markets at the end of February with a policy interest rate cut, while mentioning risks to the growth outlook amid rising threats of a global trade war. The central bank also said it was closely monitoring movements of the baht. 

More stories like this are available on bloomberg.com

Gulf News English Text RSS April 2024

©2025 Bloomberg L.P.