Thailand distributes 14 billion USD to people to stimulate economic development

According to Bloomberg News, on April 10, the special council in charge of Thailand's e-wallet program approved a funding plan for the program. Thai Prime Minister Srettha Thavisin himself is the head of the council.

Under a detailed plan just announced, 50 million adult Thai citizens will each receive 10,000 baht ($275) to stimulate the economy from the fourth quarter of 2024.

The total cost of the cash handout program is nearly $14 billion, equivalent to 2.9% of Thailand's GDP. Of this, 327.7 billion baht ($9 billion) will be drawn from the 2024 and 2025 fiscal year budgets, according to Lavaron Sangsnit, permanent secretary of the Thai Ministry of Finance.

The remaining 172.3 billion baht ($4.73 billion) will come from the Bank for Agriculture and Rural Cooperatives, which will give money directly to Thailand's 17 million farmers.

This funding option replaces the proposal for a one-time loan of 500 billion baht that the Thai government had proposed to the National Assembly.

The plan to give money to people is one of the key programs that the Pheu Thai Party - the largest party in the ruling coalition in Thailand - promised to the people of this country during the election campaign.

The party insists that this is not a cash handout program for the poor. Instead, it is aimed at pumping money into the economy to stimulate the country's growth.

Thais will receive money through the e-wallet platform and can only spend it on specific goods and services and within a certain period of time. The money cannot be used to buy alcohol, tobacco, fuel and online goods.

The Thai Finance Ministry estimates that the plan will increase Thailand's GDP by about 1.2% to 1.8%, bringing the country's economic growth rate in 2025 to nearly 5%.

"The government considers it necessary to stimulate the economy through the e-wallet program. The Thai economy is facing challenges both domestically and internationally, including geopolitical issues and uneven income recovery after COVID-19," said the Thai Finance Ministry, where Thavisin is also the minister.

The Thai prime minister himself has said the cash injection is "extremely necessary" to help the Thai economy escape a decade of sub-2% economic growth.

However, the plan has been strongly opposed by opposition parties and some central bank experts, who say that "easy money" could fuel inflation and escalate the country's public debt.