Thai Government Pulls Back on 10,000 Baht Digital Handout Scheme Amid Economic Headwinds

 

The Thai government has announced a significant backtrack on its key economic policy, confirming the postponement of the much-discussed "10,000 Baht Phase 3" digital wallet handout scheme.

 

Deputy Prime Minister and Finance Minister Pichai Chunhavajira made the announcement following a meeting of the economic stimulus committee on Monday, citing the need to wait for a more favourable economic climate.

 

This decision comes as the National Economic and Social Development Council (NESDC) forecasts a Thai GDP growth of just 1.8%, with expectations of further decline in the third and fourth quarters.

 

Pichai explained that the global economic slowdown, exacerbated by US tariff barriers affecting numerous countries, not just Thailand, necessitated a reassessment of the stimulus plan.

 

The 157 billion baht budget initially earmarked for the Phase 3 handout will now be redirected towards other economic stimulus measures. This decision, he emphasised, was not taken in isolation, with both the NESDC and the Bank of Thailand reportedly advising a review of the cash handout.

 

Consequently, the government will channel these funds into six key areas aimed at immediate impact and long-term growth:

Water Management Restructuring Projects: These include multi-year budget projects related to water for consumption and agriculture.

Ready-to-Invest Transportation Projects: Examples include road projects, double-track railways, or resolving traffic bottlenecks to improve transportation convenience.

Tourism Projects: These aim to address existing issues and promote tourism growth, such as projects in secondary cities, the creation of man-made destinations, or improvements to tourist facilities like restrooms.
 

 

Projects to Assist Exporters and SMEs: These types of projects need solutions like soft loans, which will require further discussions with the Bank of Thailand (BOT) and financial institutions to help struggling businesses.

Job Creation Projects: This involves reviewing initiatives like the Village Fund project. For instance, the previously delayed SMLs project might have budget allocated to it.

Digital and Education Development Projects: Examples include reducing education expenses for youth to enhance the country's long-term competitiveness.
 

 

 

"We haven't seen the actual project proposals yet. We need to wait for the budget-receiving agencies to submit their projects to the economic stimulus policy project subcommittee for consideration first. Most of these will likely be projects implemented next year," Pichai stated.

 

A dedicated committee will oversee and manage the allocation of these funds.

 

"The reason for reviewing the 10,000 baht handout is not a lack of funds, as our reserves are sufficient," Pichai clarified. "If the funds are used for targeted economic stimulus as planned, it is projected to increase GDP by a further 0.71-1%."

 

When pressed on whether this was effectively a cancellation rather than a delay, Pichai insisted, "It is not a cancellation. If the economic situation improves, we are ready to proceed."

 

Tourism and Sports Minister Sorawong Thienthong, in his capacity as Secretary-General of the Pheu Thai Party, echoed this sentiment, affirming that the 10,000 baht Phase 3 scheme is merely delayed.

 

He noted that the Prime Minister had previously acknowledged various factors necessitating adjustments, and the government had heeded the advice of relevant agencies to postpone the handout.
 

 

Sorawong expressed confidence that the public could be informed of this adjustment without negatively impacting the Pheu Thai Party's flagship policies, as it represents a pragmatic adaptation to challenging global economic conditions.

 

He also pointed out that the government still has the budgets for fiscal years 2025-2027 available for economic stimulus across various dimensions.

 

Regarding potential repercussions for the Pheu Thai Party's future electoral prospects given the handout was a key campaign pledge, Sorawong expressed confidence that the change of plans, driven by global economic pressures, could be adequately explained to the electorate.