The economy of Thailand can grow as much as 5% in 2017 according to a senior finance official.
The potential growth is attributed to the possible surge of private investments that the government set as a goal for next year. The finance permanent secretary, Somchai Sujjapongse, told the public that the government is looking into issuing government bonds worth an estimated 100 billion baht to be used as financing for provincial development and as a stimulus for economic growth. This move is anticipated to become a driving force strong enough to push private investment to a range of 200 to 300 billion baht by 2017.
This information was confirmed by the Deputy Prime Minister Somkid Jatusripitak who stated that the government is indeed slated to issue 100 billion baht worth of government savings bonds in the coming month of January. The said bonds would have a maturity date that would range from five to seven years and will be offered to public institutional investors. The decision would supposedly raise funds for the development of 18 clusters of provinces in the country. Moreover, this event will hopefully help offset the predicted poor global trade prospects for next year.
Mr Somchai further emphasized that private investment will be boosted by the active investments from state agencies and the government. He commented. “We expect Thailand’s economy could manage growth of 4-5% next year if the combined investment budgets from the government, state enterprises, the new government bonds to fund provincial development and ensuing private investment happen as predicted.”
Apisak Tantivorawong, Finance Minister of Thailand, also weighed in on the matter saying that this government bond issuance will serve as a catalyst for the country’s next economic step: Thailand 4.0 which is the newest economic model promoted by the government that will focus on the development of creativity, innovation, and technology in the country. Previous economic models were Thailand 1.0 which focused on the improvement of agriculture, Thailand 2.0 which gave importance to the light industry and low wage labor, and Thailand 3.0 which aimed to nurture the heavy industry and advanced machinery system.
Overall, the plans of Thailand to boost economic growth can prove to be effective if carried out successfully. By offering government bonds which hopes to be sourced from the 2018 fiscal budget, Thailand will be able to develop provinces that will help significantly in the overall economic health of the country.