Thai PM to unveil new policies to match economic challenges

By Panarat Thepgumpanat and Panu Wongcha-um

BANGKOK (Reuters) – Thailand’s Prime Minister Srettha Thavisin on Tuesday said his cabinet would this week issue a raft of policies to lower the cost of living, suspend farmers’ debts, draw more tourists and boost incomes.

Srettha and his 11-party government is presenting its largely populist policy agenda to the new legislature and inherits an underperforming economy struggling from weak demand for Thai exports and lower investor confidence.

Srettha, a real estate mogul and political newcomer, has come under fire in parliament for policies the opposition say are vague and lack clear direction. He said cabinet would formalise the plans on Wednesday and introduce them as soon as possible.

“I am not sure whether it will be a surprise or not but there are lots of policies that match the challenges,” he told reporters.

Industrial sentiment hit a one-year low in August, despite the end of months of post-election deadlock, with concerns over weak exports and the slow recovery.

Deputy Commerce Minister Napintorn Srisanpang told parliament exports might shrink up to 1% to 2% this year amid slowing global demand.

The government, led by the populist Pheu Thai Party, plans to kickstart the economy with handouts, subsidies and a raising of wages, causing some concern among economists and commerce groups about how it will be financed and that it could increase costs for businesses.

Srettha said he would negotiate with workers and employers to raise the daily minimum wage as soon as possible to an “appropriate level” of 400 baht ($11.25), up from an average 337 baht.

The 400 baht wage is expected early next year, Labour Minister Pipat Ratchakitprakarn told parliament.

“We must try to upskill workers to get a daily wage of 600 baht as soon as possible,” he added.

Srettha said the government plans to imminently lower electricity and fuel costs for consumers and allow visa free entry to visitors from China, a major source of tourists for Thailand. A moratorium on debt for farmers is planned for the fourth quarter, he added.

“We have short-term economic stimulus measures such as tourism to bring money into the service sector, making wages increase in line with demand for workers, and to reduce energy costs for people and logistics operators,” he told parliament.

Kriengkrai Theinnukul, chair of the Federation of Thai Industries, said an imminent wage hike “will aggravate an already bad situation for some smaller businesses”, adding hikes would be better next year when the economy recovers.

(Reporting by Panu Wongcha-um, Panarat Thepgumpanat and Orathai Sriring; Editing by Martin Petty)