Thailand's Cash Handouts: A Future Financial Pitfall?

[webfact]

 

With Thailand granting significant cash handouts in a bid to alleviate poverty, economists are sounding alarms over the potential long-term economic repercussions.

 

Despite the apparent immediate benefits, there's apprehension that these populist measures could undermine sustainable growth and push the country into a cycle of dependency that hampers its aspirations to transition into a high-income nation.

 

Thailand's economy currently classifies as "developing," a label it has held unrevised by the World Bank since 1988, with a GDP per capita significantly lower than that of high-income countries.

 

The thrust of the concern hinges on the sustainability of these cash handouts, which may provide temporary relief but fail to address deeper economic fragilities or build essential capabilities among recipients.

 

The government’s strategy includes tax cuts and financial assistance, which have been popular but controversial. Experts like Athiphat Muthitacharoen, from Chulalongkorn University, highlight that this spending contributes to a persistent budget deficit without fostering economic resilience or skill development essential for self-reliance.

 

According to 2023 data, the government’s recurring expenses on welfare, salaries, and debt repayments consume a substantial part of the budget, leaving little for development initiatives.

 

Critics such as Kobsak Pootrakool of the Federation of Thai Capital Market Organisation question the efficiency of these handouts. Despite government claims of decreased poverty levels, he argues that the real poverty figures have only shifted surface numbers, with many "out of poverty" households still heavily dependent on government aid.

 

The focal point of concern is whether these handouts are merely a quick fix that obscures the more chronic issues such less diversified economy or inadequate investment in human capital.

 

The potential long-term risks include growing fiscal pressures and escalating public debt, with critics cautioning that without a pivot towards more sustainable growth measures, Thailand's economic future may be at risk.

 

TOP: File photo

 

-- 2024-07-12

 

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[2baht]

Where's the money???

[lordgrinz]

3 months after they hand out the 10,000 baht, the masses will be back to begging for more, and the money will have done nothing but line the pockets of the rich (CP Group). Nothing more than vote buying, which is supposed to be illegal.

[ozz1]

I think this is not going to happen it was supposed to be implemented early this year just a vote buying exercise they will put it off as long as possible carrot on a string scenario

[watchcat]

1 hour ago, lordgrinz said:

3 months after they hand out the 10,000 baht,

 

I'd like to say after a couple of weeks.

[brianthainess]

1 hour ago, webfact said:

Thailand's economy currently classifies as "developing," a label it has held unrevised by the World Bank since 1988, with a GDP per capita significantly lower than that of high-income countries.

Developing ? more like Declining......

[brianthainess]

22 minutes ago, ozz1 said:

I think this is not going to happen it was supposed to be implemented early this year just a vote buying exercise they will put it off as long as possible carrot on a string scenario

The whole idea is unworkable, making a promise of 10K with no money there in the first place, plus it will be scammed from day one IF it ever goes ahead.

Whatever is saved on 'shopping' will just get spent on alcohol, gambling.. etc.

[bob smith]

money don't go on mango trees, Thailand.

 

I can see a financial crisis comparable to 1997 on the horizon..

 

bob.

[lordgrinz]

2 minutes ago, brianthainess said:

The whole idea is unworkable, making a promise of 10K with no money there in the first place, plus it will be scammed from day one IF it ever goes ahead.

Whatever is saved on 'shopping' will just get spent on alcohol, gambling.. etc.

 

Yup, and even with restrictions, Somchai will still trade his 10,000 baht to the family next door, who will gladly buy him beer/etc for a fee.

[brianthainess]

1 minute ago, lordgrinz said:

 

Yup, and even with restrictions, Somchai will still trade his 10,000 baht to the family next door, who will gladly buy him beer/etc for a fee.

More like Loa Kho & Yabba.  IMO.  

[retarius]

Sustainable, the key word. And no, cash payments to citizens when you have to borrow the money to do it are not sustainable. Plus the higher you drive growth this year, the bigger the targets you have to set and meet next year. It's a fool's errand. 

[proton]

Pumping money into the economy on this scale will surely just lead to higher inflation. Offering cash for votes should be illegal

[Emdog]

"...significant cash handouts in a bid to alleviate poverty...'

Well if 10k does such wonders to alleviate poverty, why stop there? 20K? 30k? 10k a month?

Let the next government worry (or not) about how to pay off that massive debt

[richard_smith237]

3 hours ago, lordgrinz said:

3 months after they hand out the 10,000 baht, the masses will be back to begging for more, and the money will have done nothing but line the pockets of the rich (CP Group). Nothing more than vote buying, which is supposed to be illegal.

 

100%...     it's this level of corruption that is ruining the country...  

 

...  Sadly, people will go to the streets, protest and fight for a government that pays for their vote.

 

[Will B Good]

If this works....why isn't every country doing it?????

[Guderian]

2 hours ago, watchcat said:

 

I'd like to say after a couple of weeks.

 

Three days more likely! lol

[hotchilli]

4 hours ago, webfact said:

With Thailand granting significant cash handouts in a bid to alleviate poverty, economists are sounding alarms over the potential long-term economic repercussions.

Hand-outs do not help anyone, a livable wage is the only answer.

But as Thailand wants to remain a sub-contract labour force for Asia and the west it will never rise above these issues.

[hotchilli]

3 hours ago, watchcat said:

 

I'd like to say after a couple of weeks.

3 trips to the nearest 7-11 and a weekend party it will be gone.

[Robert Tyrrell]

Good Afternoon,

 

Thailand's P.M. Is about to decimate the livelyhoods of Cannibis Shops and Farmers putting thousands upon thousands into finanacial hardship and poverty !!! Because they put personal intrest above medical facts and certainly uneducated in the medical benifits meanwhile allowing Thailands youth to walk into village shops purchasing alcohol underage for there adult gaurdians !! Thailand having one of the highest global road fatalities !!! Cannibis shop owners and framers should file a colabrotaive lawsuit against the Thai Goverment for buisneass loss and decimation of the Industry !!!!         

 

สวัสดีตอนบ่าย,

นายกรัฐมนตรีของประเทศไทย กำลังจะทำลายล้างความเป็นอยู่ของร้านค้า Cannibis และชาวนา ที่ทำให้คนหลายพันคนต้องเผชิญความยากลำบากทางการเงินและความยากจน !!! เพราะพวกเขาให้ความสำคัญกับความสนใจส่วนตัวมากกว่าข้อเท็จจริงทางการแพทย์และไม่ได้รับการศึกษาอย่างแน่นอนในผลประโยชน์ทางการแพทย์ในขณะเดียวกันก็เปิดโอกาสให้เยาวชนไทยเดินเข้าไปในร้านค้าในหมู่บ้านเพื่อซื้อเครื่องดื่มแอลกอฮอล์ที่ยังไม่บรรลุนิติภาวะให้กับผู้ปกครองผู้ใหญ่ที่นั่น !! ไทยมีผู้เสียชีวิตจากอุบัติเหตุทางถนนมากที่สุดในโลก !!! เจ้าของร้านและผู้วางกรอบกัญชาควรยื่นฟ้องรัฐบาลไทยในข้อหาสูญเสียธุรกิจและทำให้อุตสาหกรรมเสียหาย !!!!

                             

[animalmagic]

1 hour ago, Emdog said:

"...significant cash handouts in a bid to alleviate poverty...'

Well if 10k does such wonders to alleviate poverty, why stop there? 20K? 30k? 10k a month?

Let the next government worry (or not) about how to pay off that massive debt

You're assuming they will allow a 'next' government 

[Ben Zioner]

Try to do obvious vote buying with taxpayer [to be] money ? Even in Greece..

[neverere]

16 hours ago, lordgrinz said:

3 months after they hand out the 10,000 baht, the masses will be back to begging for more, and the money will have done nothing but line the pockets of the rich (CP Group). Nothing more than vote buying, which is supposed to be illegal.

I don't think there is any election planned in 3 months time?

 

[it is what it is]

 

capital investment would be the most effective use of the money, but capital investment doesn't fit the populist agenda.