Government spokesperson Tossaporn Serirak, on Monday, defended the government’s plan to pass a Bill to enable the Finance Ministry to borrow 2 trillion baht to fund the many infrastructure development projects, after the Democrat Party made public statements opposing the move.
The opposition Democrats claimed that the borrowing plan is against the true intent of the Constitution and will put huge public debt burden on the people of Thailand for the next 50 years or more.
But Mr. Tossaporn stated that the government has considered the current conditions surrounding local and global economies and come to a conclusion that now is the time for the state borrowing plan as interest rates in several countries are historically low while Thailand’s bond issuances are relatively low.
He added that the current strengthening of the baht will enable Thailand to import capital goods at lower costs while its liquidity is now high enough to accommodate the borrowing plan.
The government spokesperson also stressed that, as Thailand has not made any investment in major infrastructure projects for a long time, the government’s initiatives will really help boost economic growth and international confidence in the country.
He went on to assure that the borrowings will not result in public debt, which needs half a century to pay up, as the government is determined to keep the nation’s public debt below 50% of GDP, which is still below the threshold of 60%.
Lastly, Mr. Tossaporn said the borrowings will be gradually made over the course of 7 years in order to cap the increase of public debt below 1% of GDP per year.