By Bernama,
Bangkok : Bank of Thailand (BoT) deputy governor Atchana Waiquamdee on Monday said that should the government be unable to deliver its policy before the parliament, it would cause political instability and definitely affect the country’s economy, Thailand news agency (TNA) reported.
Currently, she said, the fiscal policy is vital to the government’s effort to stimulate the economy.
Should there be a delay in disbursing the budget, it would impact public confidence and private consumption and investment.
Parliamentary approval of the budget is required before the government is free to dispense funds.
Atchana said that adoption of a monetary policy to stimulate the economy by reducing the policy interest rate to help the private sector might not work since commercial banks are reluctant to lend upon concerns of the economic slowdown.
Accordingly the government must rely upon fiscal policy to boost the economy, but any measures must be implemented only temporarily to help a specific group of people which is experiencing hardship, such as employees who have lost their jobs by being made redundant.
Regarding the government’s intention to pursue the so-called ‘Six Measures Six Months’ package, she said, the government should instead help the jobless and those who experience difficulties because the populist policy could impact political stability.
In addition, she viewed the government should lift the subsidy on the oil excise tax and increase the excise tax to boost prices of agricultural commodities, particularly oil palm and sugarcane.