Thailand trapped in a household debt quagmire

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In the third quarter of last year, household debt rose 4.2 percent year on year to Bt14.35 trillion, equivalent to 89.3 percent of gross domestic product (GDP), according to the National Economic and Social Development Council. (Photo by Towfiqu barbhuiya)

 

Most Thai households have been bogged down by high debt even before COVID-19 struck in early 2020.  For many years, the average Thai worker has been struggling to make ends meet, forcing dependence on borrowings. 

 

The latest crises of a global scale, such as the persisting pandemic and its plethora of variants, and the Russian invasion of Ukraine have only made them fall into a deeper hole of debt.

 

Political focal point 

 

In the third quarter of last year, household debt rose 4.2 percent year on year to Bt14.35 trillion ($434.8 billion), equivalent to 89.3 percent of gross domestic product (GDP), according to the National Economic and Social Development Council (NESDC).

 

This dire situation has provided fodder for opposition politicians to attack the coalition government led by Palang Pracharath Party.

 

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Full story: https://www.thaipbsworld.com/thailand-trapped-in-a-household-debt-quagmire/

 

-- © Copyright Thai PBS 2022-03-24

 

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[sammieuk1]

The general & Co has a cunning plan it will be run like hell with the money ????

[ThailandRyan]

Covid safety net was not deployed and many were left to their own demise by borrowing more and more just to live everyday life.  This country is ready for another 1997 financial crisis made by this Governments poor decisions.

[Enzian]

The whole economy is organized to skim from the poor and from the urban middle class and move the proceeds up the ladder. They will just stumble along for a couple of more generations until something drastic happens to force some kind of reform. 

In the meantime the question is, Where is the tipping point when this becomes some kind of crisis? We never know till it happens, like in the US when people kept saying we should be having inflation but we're not, and then all of a sudden it took off, with Murphy's Law adding accelerators.

[BangkokReady]

Thailand is not coping well without tourism.  It is clearly not simply a case of "everyone has returned to their villages and found another source of income".  It is obvious that much of the Thai economy and most Thai people were supported by tourism income.  Time to open up with few restrictions and rescue the economy and the Thai people.

 

One would hope that in the future Thai people will have a newfound appreciation for foreigners and the money they bring in that Thai people clearly rely on to survive.  But I doubt it.

[Excel]

19 minutes ago, ThailandRyan said:

Covid safety net was not deployed and many were left to their own demise by borrowing more and more just to live everyday life.  This country is ready for another 1997 financial crisis made by this Governments poor decisions.

In many areas that crisis has already hit the households. Thai governments only consider it a crisis when their elite supporters are unable to increase their individual wealth by 20% year on year and squirrel it away overseas.

[Jerno]

41 minutes ago, ThailandRyan said:

Covid safety net was not deployed and many were left to their own demise by borrowing more and more just to live everyday life.  This country is ready for another 1997 financial crisis made by this Governments poor decisions.

Yet Pray-hoot and cronies joyfully spending billions upon billions upon billions taxpayers baht on the Military.  

[BayArea]

No worries,  the gracious government is going to LOAN the poor 10, 000 baht to help out! When you're done paying off your debt, you're stil going to be in debt. ????

[Will B Good]

As none of this has any impact on hi-sos does it really matter?

[ThailandRyan]

1 minute ago, Will B Good said:

As none of this has any impact on hi-sos does it really matter?

Guess they will not be needing the paltry 10k baht loans as they are making 20% more now  then before off of their investments.......

[CrunchWrapSupreme]

Due to their meager salaries, most Thais consider any loans or credit they can get as part of their entitled income. I know teachers certainly feel this way. Their salaries are only about 10-12k baht. Yet they always have the latest iPhones, drive Ford Fortuners, and show off their new house constructions on Facebook. All through govt backed loans.

 

They've got it good as the terms of these loans are quite lax, long terms with small monthly payments, few penalities. Other Thais can't help but see this and want similar lifestyles, but can't get those loans, so they turn to those terrible consumer debt shops on every corner, loan sharks, and gambling.

[RafPinto]

Time to order a few more submarines, fire a few nukes and order some warships.

They are probably scared of their own population.

[ThailandRyan]

Just now, RafPinto said:

Time to order a few more submarines, fire a few nukes and order some warships.

They are probably scared of their own population.

You missed ordering up the newest and most high-tech avionics jet the F-35c from the US.....need a few of them at 335 million USD.......pocket change for these folks.

[Will B Good]

2 minutes ago, RafPinto said:

Time to order a few more submarines, fire a few nukes and order some warships.

They are probably scared of their own population.

That's true....it's Thursday already.......and not heard of any major armements being ordered.

[86Tiger]

 

 

This is not a problem exclusive to Thailand.

 

The financial institutions spend millions in advertising telling you how great your life will be if you only borrow more money.  Consumer debt is a world wide problem.

[smedly]

2 hours ago, Will B Good said:

As none of this has any impact on hi-sos does it really matter?

there is a certain feel good factor when you let them know you know what they are doing - it may not make much of a difference, one thing I have noticed though is that more and more Thai people are also becoming aware, I get the feeling something is going to explode in this country like never before

[Will B Good]

14 minutes ago, smedly said:

there is a certain feel good factor when you let them know you know what they are doing - it may not make much of a difference, one thing I have noticed though is that more and more Thai people are also becoming aware, I get the feeling something is going to explode in this country like never before

Sounds very glib, but as food is never in short supply (famous last words) and the only shelter you need can be very rudimentary....... Thais will never rise up.

 

"Every society is only three meals away from revolution".....and Thais would never miss a meal.

[Pouatchee]

Judging by the contractors and entrepreneurs I see at big hardware stores, and the quantity of stuff they buy I find this article hard to believe. Someone here has got money and is spending it. 
There will always be poor ma's and pa's and mono-parental girls, but overall the money is going somewhere and it seems fewer and fewer of us are seeing it funnel down here.

 

[Skeptic7]

6 hours ago, ThailandRyan said:

  This country is ready for another 1997 financial crisis

And so am I !!! Long, LONG overdue. 

[RichardColeman]

6 hours ago, ThailandRyan said:

This country is ready for another 1997 financial crisis made by this Governments poor decisions.

Yes, but probably crash only 'in-country' whilst the baht gains more against every country on the planet 

[RubbaJohnny]

I cannot recall any regime ever saying.

 

Panic now, we have lost control, our gold, cash is en route to Bavaria , from where a short stash away to a Swiss bunker.Yours will evaporate by stealth , inflation, or theft.

 

You seldom hear economic Ministers advise, Empty your bank accounts. Of course by then it's too late 

You will know the SHTF when the queues at the ATMs longer than lottery tickets and bar fine is buy one get one free...

 

Psst want some Hrivnya ? their may be rubles ahead

Edited March 24, 2022 by RubbaJohnny

[ThailandRyan]

2 minutes ago, RubbaJohnny said:

Ah the difference between a hubcap and a lid eh

A lid of marijuana and Thailand being the Hub of caps?

[Orinoco]

5 hours ago, Will B Good said:

Sounds very glib, but as food is never in short supply (famous last words) and the only shelter you need can be very rudimentary....... Thais will never rise up.

Very true.

And they will carry on, and do nothing, but dream of the big lottery win.

After getting the numbers from the tree in my garden.

TIT.

[Mr Meeseeks]

Diddling foreigners and local boondoggles only get you so far.

 

Coming down to Earth with a very reliable (and predictable) thump.

[Will B Good]

38 minutes ago, Orinoco said:

 

After getting the numbers from the tree in my garden.

 

Wife wants to know where do you live.......

[Thingamabob]

8 hours ago, CrunchWrapSupreme said:

Due to their meager salaries, most Thais consider any loans or credit they can get as part of their entitled income. I know teachers certainly feel this way. Their salaries are only about 10-12k baht. Yet they always have the latest iPhones, drive Ford Fortuners, and show off their new house constructions on Facebook. All through govt backed loans.

 

They've got it good as the terms of these loans are quite lax, long terms with small monthly payments, few penalities. Other Thais can't help but see this and want similar lifestyles, but can't get those loans, so they turn to those terrible consumer debt shops on every corner, loan sharks, and gambling.

Ford Fortuners ?

[Paul Henry]

Will continue to increase without the tourist dollars paying the village people living in the resort towns and sending the money back home. Glad to see their is no prostitution in Thailand only great customer service.

[RubbaJohnny]

1 hour ago, Mr Meeseeks said:

Diddling foreigners

Should be TATs new slogan

[RubbaJohnny]

1 hour ago, Paul Henry said:

great customer service

and so flexible, they will bend over forwards to ensure happy bending.

[kickstart]

 

 

 

 

 

8 hours ago, 86Tiger said:

 

 

This is not a problem exclusive to Thailand.

 

The financial institutions spend millions in advertising telling you how great your life will be if you only borrow more money.  Consumer debt is a world wide problem.

 

• Debt as a percentage of GDP is expected to fall from 83.5% of GDP in 2022/23 to 79.8% in 2026/27.
• You are right they ,the above from the BBC after yesterday's UK Spring Statement,
• And I would say with inflation as it is  ,the problem will get worse, not better .
• The sooner they put interest up the better ,with inflation at 7% the money in my bank earning 0.5%,my savings are being eroded away .