Thailand’s economy resilient to the pandemic, central bank says

The Thai economy is well placed to weather the impact of the Covid-19 pandemic, the central bank said Wednesday, citing strong foreign reserves and a resilient banking system.

Although the nation’s economy is likely to recover more slowly than regional peers, it is highly resilient in handling more economic shocks, the bank’s governor Sethaput Suthiwartnarueput said.

Sethaput was one of the speakers at a “Thailand Focus 2021: Thriving in the Next Normal” forum organized by the Stock Exchange of Thailand.

The foreign reserves are high at 9.2 trillion baht and external debt remain low, the governor noted.

Thailand’s banking sector, which holds a sufficient amount of loan-loss reserves, will also play a part in strengthening the economy, he added.

Sethaput said public debt has risen to above 50 per cent of gross domestic product, but has not yet reached the cap of 60 per cent. Finance Minster Arkhom Termpittayapaisit said during the same forum that the state can raise its public debt cap if necessary.

But the ratio is expected to remain below the 60 per cent threshold this year, said Arkhom, adding that the government will offer continued fiscal assistance to small and medium enterprises hit hard by the pandemic.

Earlier, the central bank had urged the government to borrow an additional 1 trillion baht to tackle the spread of Covid-19, especially the fast-spreading Delta variant.

The request has so far been denied as the Finance Ministry said the existing 500-billion-baht loan under the 2021 emergency loan decree is adequate for the situation.

Thailand’s economic rebound will remain uneven as the nation is struggling with prolonged coronavirus outbreaks, coupled with delayed vaccine roll out, Sethaput said.

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