Bank of Thailand (BOT) Assistant Governor Tharit Punpiamrathas recently expressed concerns over soaring household debt levels.
Speaking at an annual seminar hosted by the Board of Trade of Thailand, Tharit elaborated that the household debt problem had escalated because of the global pandemic and flood disasters, which have pushed household debt to 90.5% of Thailand’s GDP. Particularly troubling was the ratio of loans taken out for consumption purposes.
Tharit urged financial institutions to cease excessive advertisements on lending and focus on restructuring debts owed by minor debtors. He also emphasized the importance of financial literacy education at schools and universities.
Meanwhile, Danucha Pichayanan, the Secretary-General of the Office of the National Economic and Social Development Council (NESDC), said Thailand’s disappointing 1.8% GDP growth in the second quarter needed urgent attention. The subpar growth was largely attributed to a decline in exports, which have, in turn, affected capacity utilization in the private sector.
The NESDC chief said only 60% of capacity is currently being utilized. Danucha also suggested reallocating some international flights to regional airports like Phuket and Chiang Mai in order to bypass Bangkok’s Suvarnabhumi Airport. Moreover, he advocated the use of the Thai baht in cross-border trade and investment.
According to the secretary-general, the NESDC encourages the private sector to seize the opportunity created by manufacturers relocating their production bases away from China. However, he noted that Thailand needs to enhance the quality of its workers and adapt its regulations to attract investments in areas such as electric vehicles (EVs), EV components and the semiconductor sector. (NNT)
