S&P Global Ratings has affirmed its stable outlook for Thailand’s BBB+ sovereign credit rating, signaling confidence in the country’s fiscal management despite plans to implement a digital wallet scheme. The announcement was made by Kim Eng Tan, the managing director of sovereign ratings for Asia-Pacific at S&P, during a seminar in Bangkok.
Elaborating on its outlook, the agency said the government’s digital wallet initiative is expected to boost domestic consumption by targeting specific population segments. The approach aligns with Thailand’s modest fiscal deficits relative to other rated nations, providing it the capacity to manage higher public debt and increased expenditures on social and infrastructure projects without jeopardizing its fiscal health.
Thailand’s public debt-to-GDP ratio has risen in recent years, largely due to the pandemic’s economic impact. However, the country’s economic recovery allows increased spending with limited risk to its overall fiscal conditions. S&P anticipates maintaining the stable rating outlook over the next one to two years, barring significant economic shifts.
Tan stressed the importance of balancing social spending goals with fiscal prudence to ensure long-term economic stability. He noted that while Thailand’s GDP growth has been slower compared to regional peers, strategic investments in areas such as education, healthcare, and infrastructure are essential for sustaining long-term growth. (NNT)
