Cabinet approves 1.26tn-baht FY2027 borrowing, with public debt forecast above 69% of GDP
Thailand’s public debt is forecast to exceed 69% of GDP by the end of fiscal 2027, before peaking in fiscal 2028 within the 70% ceiling
- The Thai Cabinet has approved 1.26 trillion baht in new borrowing as part of the public debt management plan for fiscal year 2027.
- This borrowing is projected to raise Thailand's public debt-to-GDP ratio to just over 69% by the end of fiscal 2027, approaching the 70% ceiling.
- To manage market volatility, the Public Debt Management Office (PDMO) plans to prioritize short-term funding options like Treasury bills and term loans.
- The overall fiscal 2027 plan also includes restructuring 1.9 trillion baht of existing debt and making repayments of 580 billion baht.
Cabinet has approved about 1.26 trillion baht in new borrowing under its fiscal 2027 public debt management plan. Public Debt Management Office (PDMO) director-general Jindarat Viriyataveekul disclosed the approval on September 29, 2026. The PDMO expects public debt to rise to just above 69% of gross domestic product (GDP) by the end of fiscal 2027, approaching Thailand’s 70% debt ceiling.
Fiscal 2027 plan covers borrowing, restructuring and repayments
Jindarat outlined three components of the approved public debt management plan for fiscal 2027:
- New borrowing of approximately 1.26 trillion baht
- Management or restructuring of existing debt totalling approximately 1.9 trillion baht
- Debt repayments of approximately 580 billion baht
PDMO expects public debt to peak in fiscal 2028
Jindarat put the projected debt ratio at the end of fiscal 2026 at around 68% of GDP and expected it to reach its highest level in fiscal 2028.
“By the end of fiscal 2027, the public debt ratio is expected to reach just over 69%, before peaking in fiscal 2028. But it will remain within the fiscal discipline framework, without exceeding the ceiling of 70% of GDP, before gradually declining in line with the Medium-Term Fiscal Framework,” Jindarat said.
PDMO favours short-term funding as US bond yields rise
The PDMO plans to prioritise short-term funding to manage volatile financial markets, particularly the sharp rise in yields on 10-year US Treasury bonds, Jindarat said. Its funding options include Treasury bills, promissory notes and term loans.
Jindarat explained that the approach would allow the PDMO to defer issuing long-term bonds at currently high costs, then refinance into longer-term debt when market conditions became more favourable.
The PDMO described Thailand’s existing public debt portfolio as resilient, with about 89% consisting of long-term borrowing and only limited exposure to interest-rate volatility. The government’s average borrowing cost remained around 2.6%, with no significant increase from the previous year.
