The National Economic and Social Development Board has been assigned to draw up an economic stimulus package to ensure that Thailand's economic growth this year will be at least 4 per cent, said Deputy Prime Minister and Industry Minister Kosit Panpiemras.

After a meeting of the government's economic committee, Kosit said that the government's focus would be to promote domestic investment and speed up budget disbursement to rural areas.

At the meeting, Finance Minister Chalongphop Sussangkarn informed all participants that at the end of last year, seed money flowing to rural communities declined by Bt50 billion from the previous year while lending by specialised financial institutions dropped by Bt20 billion and lending through state agencies' projects declined by Bt30 billion.

"We have discussed how to ensure a smooth flow of money into the grassroots sector," Chalongphop said. One study will focus on the ability to lend by specialised financial institutions.

However, he insisted that lending practices would be changed from the past. New lending would come under discreet review. Meanwhile, there will be a discussion with the Budget Bureau to find out if there are any projects that would ensure smooth money flow to the grassroots sector.

Several lending projects for the grassroots sector were initiated during the Thaksin government. Though the projects resulted in higher purchasing power of rural people and buoyed the economy in the past years, they are viewed by the current government as dubious populist policies.

Boosting spending is a major agenda of the government following declining investment and a potential drop in export income.

Meanwhile, Kosit said the meeting agreed that there was little the government could do to stop baht appreciation, which has been affected by the current account surplus.

"We agreed to let the Bank of Thailand handle the issue," he said.

A number of issues were tabled for the Cabinet's acknowledgement and approval yesterday, including the empowering of a labour committee in raising the minimum wage.

Deputy government spokesman Netpreeya Chumchaiyo said after the Cabinet meeting that the Cabinet approved an amendment to the Labour Act, which will empower the wage committee to raise wages whenever economic conditions are ripe.

The Cabinet yesterday also extended concessions of four onshore petroleum fields in Nan, Lampang and Tak to two Canadian companies.

"These are the last four fields under the 19th concession round. The agreements will be signed shortly," said Energy Minister Piyasvasti Amranand. The ministry will soon unveil details of the 20th concession round.

He noted the Cabinet also approved a change in shareholding in the G4 Gulf petroleum field between the Chevron Offshore (Thailand) consortium and PTT Exploration and Production (PTTEP).

Chevron will reduce its shareholding in the field from 63.75 per cent to 51 per cent, while PTTEP will increase its holding from 15 per cent to 21.25 per cent. Mitsui Oil Exploration's shareholding ratio will remain intact at 21.25 per cent. After the change, Phalang Sophon emerged as a new shareholder with a ratio of 6.375 per cent.