Thailand plans to raise govt.’s borrowing 8% for FY ’25

Thai government announced plans to increase its borrowing by 8 per cent to approximately 2.6 trillion baht ($78.2 billion) for the upcoming 2025 fiscal year, which begins on October 1.

According to market sources and a government presentation obtained by Reuters on Tuesday, 1.06 trillion baht of the projected total will represent new borrowing, while the remaining 1.53 trillion baht will be rolled over debt.

The government intends to sell government bonds worth 1.25 trillion baht and treasury bills worth 520 billion baht during the 2025 fiscal year, which will cover more than two-thirds of the borrowing target.

Jindarat Viriyataveekul, public debt advisor at the Ministry of Finance, confirmed the debt figures, stating, “They’re just like that.”

The Public Debt Policy and Supervision Committee is scheduled to meet on Wednesday to discuss the debt plan.

The increased borrowing is aligned with the government of Prime Minister Paetongtarn Shinawatra’s efforts to stimulate the country’s economy through various initiatives, including the highly anticipated digital wallet handout scheme.

The government plans to sell approximately 303-322-billion-baht worth of bonds in the October-December quarter, including 15-year sustainability-linked bonds.

Additionally, borrowing will also be supported by 120 billion baht in savings bonds, 140 billion baht in bond switching, and 556 billion baht in promissory notes and term loans.

This increased borrowing is necessary to cover a larger budget deficit for the 2025 fiscal year, which will fund government initiatives such as the ‘digital wallet’ scheme.

The government’s 2025 fiscal budget outlines spending of 3.75 trillion baht and a projected 7.5 per cent increase in the deficit to around 8.66 billion baht.

Attribution: Reuters

Subediting: Y.Yasser