Bangkok: The Permanent Secretary of the Ministry of Finance has dismissed reports suggesting the government is contemplating an emergency decree to facilitate additional borrowing. He emphasized that the Ministry of Finance has not been instructed to prepare for such an action. With the recent decline in oil prices, he indicated there is no present requirement to issue an emergency decree for guaranteeing loans for the Oil Fund. However, the Ministry of Energy is hopeful that the Ministry of Finance will still propose the matter to the Cabinet due to the Oil Fund's significant debt, which has reached 60 billion baht and continues to suffer a daily outflow of 180 million baht.
According to Thai News Agency, Mr. Lawaron Saengsanit, the Permanent Secretary of the Ministry of Finance, addressed circulating rumors about the issuance of an emergency decree that would authorize the Ministry to borrow hundreds of billions of baht to address the energy crisis and support economic stimulus projects. He clarified that the Ministry of Finance has not been directed to prepare for such measures, and he himself was not informed about any such plans.
With regards to the emergency decree to guarantee a 150 billion baht loan for the Oil Fund, the Ministry of Energy has already submitted a proposal to the Ministry of Finance. Nonetheless, due to the recent significant drop in global oil prices, there is no immediate need for such an emergency decree.
Mr. Lawaron stated, "The current management approach must adapt to the situation. At that time, there was a proposal for the Ministry of Finance to guarantee the Oil Fund's loan because global oil prices were very high. But now that oil prices have fallen considerably, a loan guarantee for this purpose is not yet necessary."
Mr. Veerapat Kiattifuengfu, Deputy Permanent Secretary of the Ministry of Energy, mentioned that the Ministry of Energy has requested a loan guarantee of 150 billion baht from the Oil Fund for consideration by the Ministry of Finance. He noted that they are awaiting the Ministry's submission to the Cabinet. If executed, this emergency decree could enhance management of the oil price situation, as the Oil Fund currently holds a cumulative deficit exceeding 60 billion baht from previous subsidies. The fund is also experiencing a daily deficit of over 180 million baht due to diesel fuel subsidies that remain higher than usual.
"If the Oil Fund remains in a negative balance with daily outflows, borrowing to manage liquidity is necessary. If the Ministry of Finance guarantees the loan, we can immediately borrow the money to improve the liquidity needed to manage the Oil Fund," said the Deputy Permanent Secretary of the Ministry of Energy.