THAILAND’S public debt outstanding as of February 28 was Bt6.09 trillion, up Bt30.58 billion or 0.5 per cent from January 31, while the Japan Credit Rating Agency (JCR) has maintained Thailand’s credit-rating ceiling at “A+” with “stable” outlook, the Finance Ministry’s Public Debt Management Office (PDMO) reported yesterday.
The JCR also put the Thai government’s foreign-currency long-term issuer rating at “A-” and “stable”, while the government’s local-currency long-term issuer rating was “A” and “stable” as of April 3.
The JCR said it maintained the country’s ceiling rating at “A+” based on its analysis that Thailand’s economy has continued to grow after exports improved, while the financial sector, especially banks, has continued to report healthy financial results.
The JCR reported that last year, Thai gross domestic product maintained growth after the government invested in infrastructure projects, and while private consumption continued to increase and the number of tourists rose strongly.
The agency noted that the government had continued to invest to develop the country’s infrastructure, while the global economy had shown signs of improvement, which would benefit Thailand’s export market.
However, the report also noted continued concerns that the country’s elderly population is growing faster than the working population, which will affect the economy in the long term. As a result, the government needs to reform the industrial sector to serve the ageing society.
The JCR also has continued confidence in Thailand’s fiscal status. Although government expenditures have been high in the 2016-17 fiscal year, and public debt this year is consequently higher than in 2016, the money has been invested to develop the national infrastructure, which will be good for the country in the long term.
Meanwhile, the financial sector has continued to maintain its non-performing-loan and capital-adequacy ratios at standard levels.
The current account has been in surplus since 2015, which means the country’s finances are still healthy. Although the current-account surplus in the next two years will likely be lower than it is now because of rising imports, this will not have an impact on economic growth in the long term, the JCR said.
The report said the JCR would monitor the country’s economy again after the coming election.
Meanwhile yesterday, Theeraj Athanavanich, the PDMO’s bond-market adviser, said total public debt outstanding as of February 28 was Bt6.09 trillion, of which Bt5.76 trillion was domestic debt (94.74 per cent of total public debt) and Bt320.43 billion was external debt (5.26 per cent of the total).
The total public debt comprised Bt4.63 trillion government debt, Bt972.46 billion of state-owned enterprises (SOEs) debt, Bt460.47 billion of government-guaranteed financial SOEs’ debt, and Bt19.35 billion of other government agencies’ debt.
Compared with last month, public debt increased by Bt30.58 billion.
The public debt to GDP as of February was 41.96 per cent, down slightly from the end of January (41.97 per cent), he said.
Classified by remaining maturity, long-term debt outstanding was Bt5.33 trillion (87.52 per cent of total public debt) and short-term debt outstanding was Bt760.12 billion (12.48 per cent).
Theeraj added that government debt outstanding was Bt4.63 trillion, increasing by Bt40.96 billion. This change was mainly contributed by the following.
Budget-deficit financing and debt management increased by Bt46.88 billion, domestic debt to finance infrastructure investment increased by Bt1.5 billion, which resulted from an increase in on-lending debt by Bt909.18 million to the Mass Rapid Transit Authority of Thailand for the Blue Line and Green Line Projects, the next an increase in on-lending debt by Bt594.48 million to State Railway of Thailand for the double-track Chachoengsao-Klong 19-Kaeng Koi project, the Red Line mass transit project, a track-strengthening project and and the double-track Jira Road-Khon Kaen project. On-lending is the borrowing of money to lend to another person or project.
Debt repayments under the emergency decree authorising the Finance Ministry to secure loans for the Financial Institutions Development Fund were made to the tune of Bt7.38 billion, and external debt decreased by Bt43.38 million, mainly on the principal repayment of an economic-recovery and social-sector programme loan, a highway-management project, the disbursement of Red Line project, and changes in foreign-exchange rates.