Govt to raise Bt700 bn from debenture issues
THE GOVERNMENT plans to raise more than Bt700 billion in fiscal 2014, mainly by issuing bonds, but does not believe that the huge fund-raising will crowd out the capital market.
Chularat Suteethorn, director-general of the Public Debt Management Office, said yesterday that the office would today invite representatives of state agencies such as the Bank of Thailand and Fiscal Policy Office to brief them on the government's fund mobilisation plan for next year.
The office outlines its funding needs to state agencies every year and allows them to voice their opinions.
Of the Bt700 billion, a portion will be used to offset the budget deficit of Bt250 billion, Bt150 billion will be invested in infrastructure and a portion will be used to roll over debt of Bt230 billion.
Of total debt, 50 per cent would be raised from the issuance of government bonds, Bt75 billion from inflation-linked bonds, Bt55 billion from savings bonds and Bt55 billion from amortising bonds.
After consultation with the Bank of Thailand, the office was assured that the plan would not drain the liquidity in the system and there was room to seek as much as Bt1.5 trillion.
The interest-rate trend looks stable in the short term to the first quarter of next year before dropping slightly, but it is likely to go up in the second half of next year to 2.5-3 per cent.
The office considers this an acceptable cost. It estimates the public debt-to-GDP ratio at 47.2 per cent next year, she added.