Thailand is rolling out a massive digital cash handout plan to boost its economy, providing 10,000 baht to 50 million citizens as part of the ‘Digital Wallet’ program.
Points
- Thailand’s ‘Digital Wallet’ program aims to jumpstart the economy with a 10,000 baht handout to 50 million citizens.
- The initiative is expected to increase GDP by 1.2 to 1.6 percentage points.
- Funding challenges led to a revised budget of 450 billion baht.
- Critics argue the stimulus is a short-term fix.
Thailand is implementing a groundbreaking digital cash handout program to stimulate its economy. Starting August 1, eligible businesses and individuals can register for the ‘Digital Wallet’ program, which will distribute 10,000 baht （approximately $275） to 50 million citizens.
Economic Boost through Digital Cash
This initiative, a key campaign promise of Prime Minister Srettha Thavisin’s Pheu Thai party, is designed to create an “economic tornado” with a predicted increase in the gross domestic product （GDP） by 1.2 to 1.6 percentage points. The government believes that this digital cash infusion will significantly boost spending and economic activity.
Funding Challenges and Revisions
Initially, the government planned to fund the program through the state Bank for Agriculture and Agricultural Cooperatives. However, financial experts raised concerns about this approach, leading to a change in funding plans. The project will now be financed through the 2024 and 2025 fiscal budgets, with the cost reduced from 500 billion baht （$13.8 billion） to 450 billion baht （$12.4 billion）.
Exclusions and Limitations
Not everyone will benefit from the handouts. Tens of thousands of shop owners and individuals with a history of fraud in past programs will be excluded. Additionally, certain items like oil, services, and online purchases may not be eligible for the digital money, although the final list will be announced soon.
Prime Minister Srettha emphasized the importance of the project, stating:
“The digital wallet is a big government project to add money to the pockets of people, small businesses, and the economy. For the sake of legal and technical prudence, and security of users, implementing the project takes time. But this wait is definitely not in vain.”
Critics’ Perspective
Despite the government’s optimism, critics argue that this kind of stimulus is a short-term fix and won’t lead to long-term economic growth. They point out that while the handout may boost spending temporarily, it does not address underlying structural issues in the economy.
Conclusion
Thailand’s digital cash handout program is a bold initiative aimed at stimulating economic activity and increasing GDP. While it faces challenges and criticisms, the government is confident that it will provide a much-needed boost to the economy. The success of this program will depend on its implementation and the broader economic context in which it operates.