Bangkok: Dr. Kriengsak Chareonwongsak, a Senior Academic at Harvard University and President of the National Building Institute, has urged the Thai government to consider alternative strategies to stimulate the economy without resorting to borrowing. The government is contemplating an emergency decree to borrow 500 billion baht to address the current economic challenges, including sluggish growth and a "polycrisis" that has affected various sectors.
According to Thai News Agency, the government attributes the need for borrowing to several external factors, such as the impact of US tax policy and volatile energy prices, which have led to a revised economic growth forecast of 1.8 percent for 2025. Additionally, natural disasters like the Super El Ni±o event have compounded the difficulties faced by farmers, prompting the government to consider increasing the public debt ceiling to support economic recovery.
Dr. Dan, however, highlights the potential drawbacks of increased public debt, emphasizing the long-term obligations it imposes on the nation. He presents five alternative solutions that could generate revenue and stimulate the economy without incurring further debt. These include reallocating existing budgets, maximizing the assets of state-owned enterprises, encouraging public-private partnerships, issuing thematic bonds, and implementing targeted tax measures.
The first approach involves efficient budget management by cutting or postponing non-essential projects and reallocating funds to address urgent issues such as drought management. By doing so, the government could potentially access 80-120 billion baht without raising the debt ceiling.
Dr. Dan also suggests leveraging state-owned enterprises by increasing dividend contributions and utilizing asset recycling to improve liquidity, potentially generating 70,000-120,000 million baht. Additionally, he advocates for public-private partnerships in infrastructure projects, which could save the government 100-150 billion baht by sharing costs with the private sector.
Furthermore, Dr. Dan proposes the issuance of thematic bonds to attract sustainable investments from institutional investors, potentially raising 50-100 billion baht. Lastly, he recommends targeted tax measures, such as windfall taxes and adjusted Value Added Tax (VAT) on luxury goods, which could generate an additional 30-80 billion baht.
Overall, Dr. Dan emphasizes the importance of exploring these options to secure 330,000-570,000 million baht in additional budget without relying solely on borrowing. He urges the government to consider these strategies to foster a transparent and efficient fiscal system, ultimately benefiting the Thai economy in the long term.