Thailand must invest or decline: Finance minister

In a speech titled “Navigating Economic Challenges: The Future of Fiscal Policy”, Pichai noted that new investment had dropped over the years from 40% of GDP to just 20% this year.

Low investment had seen Thailand’s GDP growth fall to an average of just 1.9% over the past decade, he added.

Meanwhile, government debt had risen to 66% of GDP – 4% below the fiscal ceiling. This meant the government could borrow only another 3 trillion baht over the next four years to stimulate the economy.  

Economic stimulus was urgently needed to control household debt that has climbed to 89% of GDP, Pichai said.

He outlined several measures the government was taking to stimulate investment.

Regarding domestic investment, he said technology was being harnessed to develop new investment platforms designed to attract funds.

Meanwhile, the burden of energy costs would be eased by expected oil/gas finds in the Thailand-Cambodia overlapping claims area (OCA) worth an estimated 10 trillion baht and projected to last 10 years.

Pichai also touted tourism’s potential to stimulate the economy, saying the key was to invest in infrastructure that lured travellers to stay longer in the country.

He mentioned tax reform as a way of generating more government revenue, adding that the country’s tax base was still low. The government should collaborate with the Bank of Thailand in supervising currency exchange and inflation, he said.

Investment in the transportation system, as well as casino entertainment complexes, would also play an important role in stimulating the economy, Pichai stated.

Turning to property, he said demand would be stimulated by easing lease rights for foreigners and using land under the State Railway of Thailand and Treasury Department to build housing for low-income Thais.

Pichai said the government has targeted GDP growth of 3.5% with inflation capped at 2%.