Thailand’s economy suffered greatly under Prime Minister Prayuth Chan-ocha, and the GDP underperformed compared to other economies in the region
Thailand’s general elections are around the corner, and it is predicted that the opposition would have an overwhelming victory. The May 14 national elections are definitely a decisive moment for the country and could potentially halt the semi-autocratic government to form democratic governance. Thailand’s economy suffered greatly under Prime Minister Prayuth Chan-ocha, and the GDP underperformed compared to other economies in the region. The battered economy, however, came in handy during election campaigns.
Economy and Elections: A win-win situation
Thailand’s main opposition party plans to hand out nearly 500 million baht, that is $15 billion in cash if it wins the election next month. This move comes in as an effort to revive the kingdom’s straining economy and provide relief to people who are battling debt issues. Pheu Thai Party, the main opposition promises to distribute 10,000 baht each to more than 50 million citizens, aged 16 and above within months of coming into power. The party plans on distributing the money through digital wallets built on blockchain that can be used to buy goods and services for individuals.
Thailand’s GDP figures in 2022 came below expectations with the economy growing 2.6% after adjusting for inflation. The regulators hoped the economy would progress in 2023 but the growth contracted in the fourth quarter of 2022. GDP underachieved compared to other regions like Malaysia and the Philippines. People in Thailand are also battling record household debts with many parties contesting the elections promising cash and debt suspension in order to attract voters.
This, however, raises concerns about an increase in state debt which will further increase inflation. Before Pheu Thai announced the digital cash scheme, various other parties which are contesting the elections made several pledges, and according to Thailand Development Research Institute, it will already require about 3.14 trillion baht.
The party is also promising a steep increase in minimum wages and steps to boost farm income along with a minimum monthly household income guarantee. The opposition party plans on forming a government of its own and if it lacks enough numbers, it will join with other democratic parties that agree to its policies, stated Prommin Lertsuridej, the head of the party’s economic policy committee. Pheu Thai is employing a playbook of populist policies that assist the parties allied with former Prime Minister Thaksin Shinawatra as the single largest party in parliament during the elections conducted in the last two decades, reports Bloomberg.
The election campaign pledges are mainly focused on bringing up a suffering economy and reducing the burden on voters. The pledges are also directed at bolstering more income-generating activities that would help in placing Thailand as the economic powerhouse of the region once again, said Prommin. Prommin analysing the Thailand economy stated, “You have zero pulse, and we have to resuscitate your heart with a shock.”
Where will the funds come from?
The opposition party plans on having the fund from a combination of additional government revenue of 260 billion baht, 100 billion baht from redundant budget allocation, 100 billion baht from tax collection, and the remaining will be allocated from the prime minister’s discretionary fund. Srettha Thavisin, one of the prime ministerial candidates stated that the country is economically suffering over the last eight years with additional expenses and less income for the citizens. “The current government has been feeding IV drips with small money handouts. That’s not the right way and doesn’t stimulate the appropriate and right economic growth,” stated Thavisin.
The money that the party is planning to distribute could be used by families to make their daily ends meet, support agriculture, or could be used as a source of investment that will generate income in the future. Pheu Thai also plans to grant land titles to nearly 8 million hectares of agricultural land to farmers who can use it as collateral to gain money from financial institutions.