BANGKOK, 21 September 2011 -Former Deputy PM and Industry Minister Kosit Panpiemras has voiced his concern about the government’s economic policy, which he fears would land the country in financial trouble.
Kosit, currently Executive Chairman of Bangkok Bank, has warned that the country may in the future run into debts now that the government’s economic policy was aimed at boosting the economy through spending rather than investment promotion.
Kosit said the country’s current savings accounted for only 15 percent of the national GDP. Such percentage is a sharp drop from the country’s savings more than 10 years ago, which represented 25 percent of the national GDP.
He explained that with a little cash left in the state’s coffers, the government may have to seek loans when it has to invest in mega-projects.
Kosit commented that investment projects should be funded by cold money, not loans which could in the end put the country at financial risk. The decline in people’s savings would also pressure commercial banks to launch more fund-raising campaigns.
To increase savings, Kosit suggested that tax adjustment should be carried out to ensure more revenue.