FRIDAY, March 29, 2024
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Ministry to repay debt to SSO this year: Sommai

Ministry to repay debt to SSO this year: Sommai

FINANCE MINISTER Sommai Phasee says his ministry will pay back the Bt65 billion it owes to the Social Security Office (SSO) before the end of this year as it is part of the government's plan to restructure around Bt720 billion worth of public debt.

The Bt720 billion amounted to 12.56 per cent of the total public debt of Bt5.73 trillion (43.3 per cent of the gross domestic product) as of March 30.
The SSO said last month that it wanted the Finance Ministry to consider paying back the accumulated loans it had borrowed from the office since 2011 as it wanted to use the capital to fund its increased investments in equity.
SSO has enjoyed a Bt10.033-billion profit from its investments in foreign assets since 2002 and has urged the government to allow it to increase its limits on investment in equity and foreign assets to pave the way for more profit. The office’s foreign-investment budget, which accounted for 2.84 per cent of the SSO’s total assets of Bt1.252 trillion, has grown from around Bt2 billion to the current Bt28.1 billion in the past four years.
Sommai said the ministry would pay the SSO back this year.
“It is part of a public-debt restructuring plan that will [go before] the Cabinet by August. We do not want to owe anybody money for a long time,” he said after providing a keynote speech at an investment forum that was arranged by Nation Radio 102 FM yesterday.
At the same seminar, the managing director of Kasikorn Securities, Padermpob Songkroh, said the SET Index should be able to reach 1,620 points by the end of this year and investment in equities was the way to go.
The Stock Exchange of Thailand’s price-to-earnings ratio is expected to be 16 times by year-end on anticipated earnings per share of Bt98.45. The economy is not that bad, so a P/E ratio of 15-16 times is not that expensive, he said. “Investment is and will continue to be good this year because there is nothing to worry about over Greece, and I am more concerned about the expected increase in the United States’ interest rates,” he said.
“Fund flows will usually seek risky assets two months before a rate hike, which is similar to what is happening right now, and some but not much of the flow will find its way [to Thailand]. 
“The three consecutive cuts of China’s reserve requirement ratio are also a positive sign, since Asian stocks usually bounce up when China cuts its RRR rate, from the extra liquidity,” he added.
KSecurities expects Thailand’s GDP to expand by 2.8-3.0 per cent this year, which is adequate. The sectors that are attractive for equity investment in the current second half are consumer businesses, commodities, oil producers and petrochemicals in the energy sector and domestic tourism, which is enjoying good performance this year. 
 
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