New stimulus to turbocharge GDP
New Finance Minister Ekniti Nitithanprapas says the government's economic stimulus plan will enable GDP expansion of more than 1% in the fourth quarter, up from an earlier forecast of just 0.3%.
In the first quarter of this year, the Thai economy grew by 3.2%, dipping to 2.8% in the second quarter. For the third quarter, growth is projected at 1.7%, while for the final quarter, the initial forecast was a mere 0.3%.
However, Mr Ekniti said five measures in the fourth quarter should help lift GDP by another 0.2-0.4 percentage points, raising growth to around 1%.
Regarding the "Khon La Khrueng" co-payment scheme, which will be submitted to the cabinet on Oct 7, he said registration for the public will be open from Oct 20-26, with the scheme starting on Oct 29. Total spending under this scheme is estimated at 66 billion baht.
Shops wanting to participate can register from Oct 15 until the programme ends in December.
The tourism stimulus scheme for secondary cities will be submitted to the cabinet on Oct 14, with hotels allowed to deduct expenses from taxes up to double the amount, said Mr Ekniti.
This measure was previously implemented in 2018, resulting in only 200 million baht in lost state revenue.
In terms of government spending, ministries and state enterprises with budgets allocated for seminars will be required to accelerate spending over the next four months, front-loading their budgets, he said.
This budget for seminars is estimated at 6-8 billion baht and is intended to stimulate the economy, said Mr Ekniti.
Regarding the issue of baht appreciation, he said the currency has already started to weaken, as the recent appreciation mainly stemmed from a current account surplus driven by exports and capital inflows.
In terms of gold exports to Cambodia, Mr Ekniti said the converted value was only US$2 billion, which is small compared with total capital inflows.
A working group has been established to monitor inflows from untraceable transactions, sometimes considered "off the books" or "grey money", which could affect baht appreciation. The working group comprises representatives from the Anti-Money Laundering Office, the Securities and Exchange Commission, and the Fiscal Policy Office.
In a related development, finance permanent secretary Lavaron Sangsnit said Khon La Khrueng Plus conditions will differ from the previous scheme when only small retailers who were not registered as juristic persons were allowed to receive payments.
This time, micro small and medium-sized enterprises (SMEs) and small businesses registered as juristic persons are also eligible to participate.
In the Revenue Department's system, there are roughly 3,000 micro SMEs with annual revenue of under 1.8 million baht, and another 2,000 micro SMEs with annual revenue of between 1.8 million and 30 million baht.
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