BANGKOK (Reuters) – Thailand is planning a larger budget deficit of 713 billion baht ($20.71 billion) for the 2025 fiscal year and higher spending of 3.6 trillion baht that year, the government said, in a plan that would see a rise in spending over the next two years.
The government predicts GDP growth of 3.6% in 2025, it said in a statement dated December 26, the day when the plans were approved by the cabinet without being fully, pro-actively divulged. The 2025 fiscal year starts on Oct. 1, 2024.
“The government still needs a short-term deficit budget to support continued economic expansion and stability,” the government said.
The plan projects inflation of 1.5-2.5% in 2025, it said, and a public-debt-to-GDP ratio of 63.73% at the end of the 2025 fiscal year.
The 2025 budget plan would increase spending from the 3.48 trillion baht planned for the 2024 fiscal year, when spending is also set to increase from 2023.
The deficit would increase in 2025 after a slight drop forecast in the 2024 draft budget.
The 2024 budget has been delayed from the original Oct. 1, 2023 start date due an election in May and a long period under a caretaker government.
On Tuesday, the cabinet approved the draft budget bill for the 2024 fiscal year which will go to parliament for the first reading next week.
($1 = 34.43 baht)
(Reporting by Orathai Sriring and Kitiphong Thaichareon; Editing by Francesco Guarascio)
