Thailand’s government set aside, on Tuesday, 350 billion baht to support the country’s ailing economy in a move that analysts say is not enough to help the economy, especially the hospitality industry, recover from the recession caused by the coronavirus pandemic.
The assistance measures include 250 billion baht of soft loans provided by the central bank and another 100 billion baht for asset warehousing to help debtors who are unable to repay loans, said the minister Arkhom Termpittayapaisith.
Under the soft loans schemes business owners with credit not exceeding 500 million baht at each financial institution can apply for loans up to 30 per cent of the credit limit capped at 150 million baht.
For those who do not have any credit, they are able to apply for loans up to 20 million baht, with a low interest rate in the first five year supported by the central bank.
The cabinet also approved the extension of the fraud-plagued travel subsidy scheme Rao Tiew Duay Kan (We Travel Together) until the end of July.
Another tourism stimulus programme, the Tour Teaw Thai (Travel around Thailand), was also approved in the cabinet meeting. It offers a discount of 40 per cent, capped at 5,000 baht, on a package tour worth at least 12,500 baht per person to around 1 million registrants.
Worries over economy
Despite passing the domestic tourism stimulus and the loan schemes for businesses, analysts say that the path to recovery for the economy remains rocky.
Economists at Kasikorn and Siam Commercial Bank have pointed to the second wave of the Covid-19 pandemic as particularly impactful to the country’s predicted GDP growth in 2021 and said that numbers have to be revived from the knock-on effect of lockdown measures.
The hospitality industry in particular looks set to be impacted until the end of the year with revenue numbers unlikely to return to pre-Covid levels until the middle of next year.
“These domestic tourism travel plans are a good start but they are a drop in the bucket compared to the spending of foreign tourists,” said Thai analyst Arun Saronchai.
“The country will not reopen until October of 2020 and that is if there is no third wave of Covid. Plus international travel will still be impacted until the entire world can be vaccinated, it means there will be no ‘old normal’ until next year,” he told Thai Enquirer on Wednesday.