The NESDC says the B400bn budget under the government’s B1.9tn in relief measures will ward off a GDP plunge of over 6%.

Sum will stop plunge in economy this year

The government’s think tank, the National Economic and Social Development Council (NESDC), insists the 400-billion-baht budget earmarked for economic and social rehabilitation under the government’s 1.9-trillion-baht coronavirus relief measure will be instrumental in stopping the economy from plunging more than 5-6% this year.

Thosaporn Sirisamphand, the NESDC’s secretary-general, said although the goal of such a budget is not to directly stimulate the economy, it will help shore up the overall economy from the free fall and create sustainable growth for the economy in the long run.

The NESDC on May 18 cut its economic forecast to a contraction of 5-6% this year, down from the 1.5-2.5% growth projection made on Feb 17.

The government in April launched a 1.9-trillion-baht package, marking the biggest relief measure ever, to soften the economic blow.

Of the total, 1 trillion baht is for cash handouts aimed at virus-hit segments and farmers, public healthcare spending and economic and social rehabilitation; 500 billion is for the central bank’s soft loan scheme for small and medium-sized enterprises, with credit lines of up to 500 million; and 400 billion for the Corporate Bond Stabilisation Fund.

Deputy Prime Minister Somkid Jatusripitak said earlier agriculture, tourism and state spending will be instrumental in rebooting the economy in the third and fourth quarters.

The government’s plan to splash 1 trillion baht, especially 400 billion slated for economic and social rehabilitation through projects aimed at creating jobs, strengthening communities and building infrastructure, will help stimulate the local economy.

According to Mr Thosaporn, the first batch of the social and economic rehabilitation budget worth 80-100 billion baht is scheduled to be injected in July.

The NESDC late last month screened the first round of 213 projects worth 101 billion baht.

State agencies have submitted more than 46,000 proposals worth about 1.5 trillion baht to the NESDC.

In the first round, the agency targeted projects targeting three areas — plans to strengthen the grassroots economy, create sustainable growth and stimulate domestic consumption and tourism, he said.

Noteworthy grassroots plans include projects to promote the sufficiency economy in the agriculture sector.

Another is a scheme to hire about 16,000 volunteers or laid-off workers to take care of 700,000 elderly nationwide, and a project to hire two new graduates per tambon, totalling 15,510 jobs in 7,255 tambons, to collect information for use in big data analysis.

The government also plans to strengthen community businesses via a 15.3-billion-baht injection into the Village Fund and the Urban Community Office.

Significant projects to cultivate sustainable growth include a 16.05-billion-baht project to develop 5 million rai covering 5,450 large-scale farms. The aim is to implement more machinery on large farms to increase the value of production by about 11 billion baht a year.

After the first approvals, the government hopes to create more than 410,000 jobs and pull 95,000 farmers out of poverty.

According to Mr Thosaporn, for the remaining 300 billion baht, the second batch worth around 100 billion is projected to go before the cabinet in August, and the rest worth 100 billion baht each in September and October.