Debate over Thai government’s digital wallet handout impact on public debt

The Thai government’s proposed 10,000-baht digital wallet handout has sparked debate, with concerns regarding its potential impact on public debt. Deputy Finance Minister Julapun Amornvivat stated that this economic stimulus is necessary as economic growth has averaged only 2% annually over the past decade, insufficient to support the country’s ageing population in the future.

With low GDP growth, the government’s public debt-to-GDP ratio will also increase. If GDP growth remains less than 5%, public debt could exceed 70% of GDP by 2027, surpassing the sustainable limit set by the State Fiscal and Financial Discipline Act.

Opposition parties and economists have questioned this urgency, noting that, although stagnant, the Thai economy has not contracted as seen in other countries that have implemented cash stimulus.

The government’s…