Thailand’s new PM reveals policy agenda to parliament as consumer mood drops

• The government plans to distribute 10,000 baht ($300) to 50 million people, with some to be given in cash.
• Consumer confidence fell for the sixth consecutive month to a 13-month low in August.
• Paetongtarn, 38, is the fourth member of her family to hold the top position.

On Thursday, Thai Prime Minister Paetongtarn Shinawatra presented her government’s policy agenda to parliament, highlighting plans to distribute 450 billion baht ($13.4 billion) in handouts to boost Southeast Asia’s second-largest economy. Political newcomer Paetongtarn, who became Thailand’s youngest premier after a court removed her predecessor Srettha Thavisin, saw her cabinet sworn in earlier this month.

The policies largely maintain the agenda of her predecessor Srettha and the populist Pheu Thai party, including debt restructuring and legalizing casinos to attract investment and tourists. Paetongtarn told parliament that her government faces challenges, including structural economic issues, and pledged to act urgently to stimulate growth.

“If there are no financial and fiscal measures to support economic growth, it is expected that the country’s economic growth rate will not exceed 3 percent per year,” she said.

She said that this would push the public debt level close to the 70 percent GDP ceiling by 2027. As of the end of July, public debt was at 63.74 percent of GDP.

“Therefore, it is a great challenge that the government must urgently restore the country’s economy to quickly grow strongly again,” Paetongtarn said.

She highlighted the key plan for a ‘digital wallet’ handout of 10,000 baht ($300) to 50 million people, with some of it, as Paetongtarn has previously mentioned, to be given in cash. However, she did not provide updates on the rollout details. This week, the government announced it would distribute 145 billion baht ($4.2 billion) from the program to support vulnerable groups later this month.

Economists and former central bank governors have criticized the scheme as fiscally irresponsible, a claim the government rejects. The government has faced challenges in securing funding for the program. Despite this, it insists that the policy is crucial for energizing the economy, which the central bank projects will grow by 2.6 percent this year—up from 1.9 percent in 2023 but still trailing most regional peers.

Consumer confidence fell for the sixth consecutive month to a 13-month low in August, according to a survey released on Thursday. Paetongtarn, 38, made her debut appearance in parliament as Thailand’s second female prime minister. She is the fourth member of her family to hold the top position. Her father, billionaire Thaksin Shinawatra, Thailand’s most influential and divisive politician of the past two decades, has supported the stimulus plan and remains a key figure behind her Pheu Thai party.

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