Thailand: State aims to expedite consumer spending
The government is mulling a faster rollout of the fourth phase of the “Khon La Khrueng” co-payment subsidy scheme to stimulate spending.
Deputy Prime Minister Supattanapong Punmeechaow said on Thursday the government is studying expediting the co-payment scheme to pump up consumer spending amid the Omicron outbreak.
On Dec 21 last year, the cabinet approved in principle the fourth phase of the co-payment subsidy after the third phase expired at the end of 2021.
The fourth phase is scheduled to run between March and April this year.
Deputy Finance Minister Santi Promphat said he has been in talks with related state agencies on the matter.
The co-payment scheme sees the government subsidising 50% of food, drink and general goods purchases for participants.
The total subsidy is limited to 150 baht per person per day.
Four state stimulus schemes meant to mitigate the impact of the pandemic expired on Dec 31, 2021. One was the third phase of the programme providing additional cash handouts to state welfare cardholders.
The other three comprise the scheme to provide additional cash handouts to those in need of special assistance, the third phase of the Khon La Khrueng scheme and the “Ying Chai Ying Dai” (the more you spend, the more you get) scheme.
The four schemes saw around 41.5 million participants exercise rights for benefits with total spending of 254 billion baht.
The third phase of the Khon La Khrueng scheme saw 26.4 million participants exercise rights out of 28 million registrants, with total spending of 224 billion baht.
Of the total spending, 114 billion baht was spending by participants, with the remainder the state subsidy.
The Ying Chai Ying Dai scheme saw 91,951 participants exercise rights out of 490,000 eligible registrants. Their total spending stood at 3.82 billion baht.
The scheme provides users with cashback e-vouchers for purchases, encouraging people to buy food, products and services at participating shops.
In a related development, Mr Supattanapong said the government also pledged to implement other measures to bolster consumption, such as an incentive to increase electrical vehicle purchases sometime this year.
He said the government wants to manage inflation, keeping it within a target framework of 1-3% this year.
“The government and the Bank of Thailand are closely monitoring inflation. If the inflation rate is close to 3%, the government is set to organise an emergency meeting for all related agencies to harness the pressure,” said Mr Supattanapong.
The deputy premier admitted the government is concerned about the continued increase in the price of goods, promising the administration will try its best to curb the sharp rise.
“Higher inflation is linked to global trends, including rising consumption demand and a recovery of the global economy,” he said.
“The Covid-19 pandemic has led investors to delay their investment, resulting in shortages of certain products. The situation is expected to improve once the Omicron infections ease.”