Thailand plans fuel price cuts to revive economy

Thailand’s new government plans to give each citizen a 10,000 baht ($282) handout, delay debt payments and lower energy prices in a bid to ease the cost of living and boost the economy, according to a draft of a policy speech Prime Minister Srettha Thavisin is due to give in parliament next week.

The draft speech was seen by Reuters on Wednesday. Srettha, who is also finance minister, was sworn in along with his cabinet this week, and will deliver the address to parliament on Monday before his government can officially carry its duties.

“The policy will trigger economic growth … we will inject the economy with cash so that it reaches everyone and creates opportunities for all,” Srettha said in the draft.

Srettha’s populist government inherits an economy growing at a pace that is slower than expected, as weak exports and lower investments undercut strength in tourism.

Last month, the state planning agency cut its 2023 GDP growth outlook to 2.5-3.0% from 2.7-3.7% after a weaker-than-expected second quarter. Last year’s growth was 2.6%.

The 560 million baht ($15.8 million) handout scheme, which will be paid into the digital wallets of all Thais aged 16 and above, was a major part of campaign that Srettha and his Pheu Thai party launched ahead of the May election.

In the policy speech draft, the government said it would help farmers and small businesses affected by the pandemic by offering them debt moratoriums. “That will be fiscally responsible and not create moral hazard,” the draft said.

The government also plans to lower the prices of electricity and cooking oil, the speech showed, as well as further promote tourism to bring in more revenue by relaxing visa requirements from specific countries.

Thailand expects to receive about 29 million tourists this year, lower than its 2019 record of 39.9 million arrivals.

($1 = 35.47 baht)