Bangkok: Academics from the Thai Chamber of Commerce have recommended the “Half-Half” scheme as a means to stimulate the grassroots economy.
According to Thai News Agency, the measure, which aims to alleviate economic hardship, is expected to have a positive impact on the local economy, as well as on the global economy, through the revival of the free trade system disrupted by past tariff policies.
Assoc. Prof. Dr. Anusorn Thamjai, Dean of the Faculty of Economics and Director of the Digital Economy, Investment, and International Trade Research Center (DEIIT) at the University of the Thai Chamber of Commerce, highlighted that the “Half-Half” measure has been found to stimulate the grassroots economy. Research indicates that for every 1 baht spent by the government, approximately 0.4 baht is generated in new consumption. While the overall impact on stimulating consumption is not considerable, the scheme has significantly benefited small businesses, especially in low-income areas, by increasing their sales.
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ccording to research from Chulalongkorn University, entitled “Digital Fiscal Stimulus and SMEs: Difference-indifference Evidence from Thailand’s Half-and-Half Program,” by Athipat Mutitajaroen, the “Half-and-Half” measure resulted in a 174% boost in sales for small shops and created a new customer base. Although small shops gained the most, the overall economic stimulus effect was limited, as most consumers only altered their spending habits within the program rather than increasing their total spending.
Dr. Anusorn emphasized that economic stimulus measures’ effectiveness hinges on improved consumer confidence, future income expectations, and job security. A knowledgeable and competent cabinet would enhance these confidence factors, contributing to short-term stimulus measures’ success.
Dr. Anusorn also addressed the changing landscape of trade tariffs following a U.S. Federal Appeals Court ruling on August 29, 2015. The court ruled that former President Trump’s import tariff orders exceeded legal authorit
y. If upheld by the Supreme Court, this ruling could repeal high retaliatory tariffs, allowing importers to reclaim taxes and positively impacting global trade and the Thai economy. However, this introduces uncertainty in US trade negotiations.
It is anticipated that trade protectionist measures will continue through the US Congress, although significant legislative changes are unlikely this year. The Trump administration’s push to shift the global trade system from rule-based to deal-based may face challenges, potentially leading to a revival of the multilateral free trade system due to judicial checks and balances.