Thailand will whittle down a plan to hand out cash to its citizens to jumpstart its economy after some economists and former central bankers warned that the move may stoke inflation and widen fiscal deficit.
The so-called digital wallet program will cover 50 million people with each receiving 10,000 baht ($280) that needs to be used within six months, according to Prime Minister Srettha Thavisin. That’s down from an original proposal to extend the handout to 56 million people who are 16 years or older.
To be eligible for the cash handout, one should be earning a monthly salary below 70,000 baht and have less than 500,000 baht in savings.
The cash dole will cost the government 500 billion baht and will be funded through a one-time borrowing, he said. It will be part of a 600 billion baht borrowing to through a special bill to be proposed to the parliament.
The one-time digital wallet payment is the flagship pre-election promise of Pheu Thai Party that leads the current coalition government. Srettha, a former property tycoon-turned premier, has said the cash handout “will act as a trigger to revitalize the economy,” that has expanded at less than 2% average in the past decade, well below its Southeast Asian neighbors such as Indonesia and Vietnam.
Srettha’s proposals are part of a plan to stimulate economic growth to about 5% annually over the next four years. A petition signed by dozens of Thai economists and analysts, including former central bankers, last month said the program will do more harm than good.
