Thailand’s $102 Billion Budget Gets Initial Nod From Lawmakers

(Bloomberg) -- Thailand’s lower house of parliament voted in support of a $102 billion budget for next fiscal year that seeks to ramp up state spending to drive growth in Southeast Asia’s second largest economy.

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The 3.75 trillion baht ($102 billion) budget for the fiscal year starting Oct. 1 was backed by 311 lawmakers in the 500-member House of Representatives late Friday. A total of 175 lawmakers voted against and two abstained following a three-day debate in the first reading of the proposals, with the spending plan likely to be approved after two more readings.

Prime Minister Srettha Thavisin is boosting state spending for a second straight year in a bid to propel Thailand’s annual growth rate to his target of 5%. Southeast Asia’s second-largest economy has lagged behind its peers in the region, logging an average growth rate of below 2% in the past decade.

A part of the budget is set to be used for Srettha’s controversial cash-handout program to give each Thai citizen 16 years and older 10,000 baht each. The prime minister expects the so-called digital wallet program to create a “whirlwind” impact on the economy by fueling consumption and manufacturing.

Srettha’s cabinet has also approved a supplementary budget of 122 billion baht for the current fiscal year to stimulate the economy. The administrations plan to seek parliamentary approval for the additional spending in July.

The 2025 budget proposals include a deficit financing of 866 billion baht, or 4.4% of gross domestic product, based on projected growth of 2.8%-3.8% pace next year. Headline inflation is estimated in a range of 0.9%-1.9% this year and 1.1%-2.1% in 2025, according to the budget draft.

The budget plan will now be sent to various committees for scrutiny. The house will take up the bill for a second and third reading in August before sending it to the Senate for its consideration and approval early September.

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