Thai Cabinet approves $5.9 billion stimulus package amid new Covid-19 outbreak

BANGKOK (BLOOMBERG) – Thailand’s government approved a set of economic stimulus measures worth 140 billion baht (S$5.94 billion) to counter the impact from the nation’s biggest coronavirus outbreak yet.

The measures – which include cash handouts to welfare card holders and special groups, co-payments and cash rebates – are expected to be implemented from July, Mr Anucha Burapachaisri, a government spokesman, said on Tuesday (June 1).

Thailand’s economy is facing strong headwinds from the country’s latest Covid-19 outbreak, which has totalled more than 130,000 cases since it began in Bangkok nightlife venues in April.

Bank of Thailand Governor Sethaput Suthiwartnarueput said on Monday the economy may not return to pre-pandemic growth levels until early 2023, three quarters later than previously expected.

The latest aid is on top of an 85.5 billion baht package last month that extended two cash handout programmes implemented.

The two latest packages will be financed by borrowing under a 1 trillion baht programme approved in April 2020, Mr Anucha said.

King Maha Vajiralongkorn last week endorsed a further US$16 billion (S$21 billion) borrowing plan to finance relief measures when the 1 trillion baht programme runs out.

The package announced on Tuesday includes:

– 93 billion baht in co-payments for consumer purchases, targeted at 31 million people.

– 16.4 billion baht in cash handouts to 13.65 million holders of welfare cards.

– 3 billion baht cash handout to 2.5 million people considered members of special groups, such as the disabled.

– A 28 billion baht cashback measure aimed at 4 million high-income people.

The new outbreak has weakened prospects for an economic recovery, with Thailand’s central bank and the main economic-planning agency both warning of risks to their growth forecasts if a reopening of the country’s key tourism sector is delayed.

The planning agency said last month that after contracting 2.6 per cent in the first quarter of the year, the economy now is expected to grow 1.5 per cent to 2.5 per cent for all of 2021, compared with February’s 2.5 per cent to 3.5 per cent forecast.

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