Govt to run deficit to spur growth
The government has decided to run a small fiscal deficit of 1.2 per cent of gross domestic product to stimulate the economy and achieve 4.8-per-cent growth.
The Cabinet yesterday approved total public expenditures for this fiscal year, Government Spokesman Yongyuth Mayalarp said. The government wants to spend Bt1.52 trillion but revenue is forecast to come in at only Bt1.42 trillion, leaving a budget shortfall of Bt100 billion, which is equivalent to 1.2 per cent of GDP. According to the government's statement, capital spending will account for 26 per cent of total planned expenditure, slightly down from 26.3 per cent last year. Current spending is projected at 70.4 per cent, about level with last year's 70.5 per cent. Redemption of government debt accounts for 3.6 per cent of the overall budget, up from 3.2 per cent last year. The revenue projection of Bt1.42 trillion is higher than last year's revenue by 4.4 per cent, but lower as a proportion of GDP - 16.8 per cent versus 17.5 per cent. The Budget Bureau sees the economy next year expanding by 4.8 per cent with prices rising by 3.5 per cent. The government aims to maintain its public debt-to-GDP ratio - currently at about 40 per cent - at no more than 50 per cent. Government agencies and state enterprises will complete detailed budget requests by the end of the month. The Cabinet will approve the draft Budget Bill on November 28 and forward it to the National Legislative Assembly by December 4. On December 29, Prime Minister Surayud Chulanont will send the budget act to His Majesty the King for endorsement. The protracted political crisis has delayed the budget for fiscal 2007, which started this month.
Wichit Chaitrong
The Nation
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