Thailand to borrow 2.59 trillion baht for 2025 budget

[ModdaPunk]

Now we know where western inflation money is going.

We are paying more so that insolvent consumers in the emerging world can keep pushing.

Nice!

Edited Friday at 08:55 AM by ModdaPunk

[billd766]

2 hours ago, NoDisplayName said:

 

Hub of maxing out the cash advance on your final available credit card to pay the late fees on your other maxed out delinquent credit cards!

Luckily for me I got rid of all my credit cards years ago and I just have debit cards only.

 

If I order something using them it will be rejected if there are not enough funds available.

 

A brutal but effective way of staying out of debt.

[Purdey]

On 9/19/2024 at 4:16 PM, snoop1130 said:

public debt is projected to reach 66% of gross domestic product (GDP) by the end of September next year, assuming a 3% economic growth rate. This figure remains below the 70% legal ceiling but is an increase from 63.7% at the end of July 2024,

I have a feeling that if they get to 70% they will simply change the law to 80% or more.

Didn't Thaksin pay off the country's debt to the IMF in record time?

[tomacht8]

If Thailand managed to properly combat corruption and properly tax the top 5 percent of the richest Thais, the country would not need to take out loans.

[tomacht8]

5 hours ago, chiang mai said:

60% of GDP is not big by international standards, neither is 70. 

That's right. But if you add consumer loans from the private sector, things look bleak in Thailand. The majority of the Thai population is up to their ears in personal debt already. And now the goverment try to max out there loans for public spending.

Edited Friday at 10:18 AM by tomacht8

[chiang mai]

21 minutes ago, tomacht8 said:

That's right. But if you add consumer loans from the private sector, things look bleak in Thailand. The majority of the Thai population is up to their ears in personal debt already. And now the goverment try to max out there loans for public spending.

Yes, but you can argue this a number of different ways. You could say that at least the country doesn't have massive social security/pension costs hanging over its head plus it's free of unions. Plus the debt level is not that high by comparison and it's all Thai debt, not foreign. In those regards the country is still its own master and not obligated externally. Western countries are now on the cusp of having to take things away from citizens because of massive debt overhang, Thailand at least is still at that point where it has an opportunity to get the way forward right, for everyone's benefit.

[chiang mai]

Awww, too difficult and confusing eh!

[chiang mai]

13 hours ago, billd766 said:

I am a bit confused.

 

Why would and country borrow money to repay debt?

 

Surely all you end up with is a bigger debt.

 

The way out of that debt trap is to borrow more money to repay THAT debt.

 

Now me, I would have thought that the best way out of debt is to cut back on spending, borrow NO money, and repay what you owe,

Borrowing can be OK or even good, if it's for the right reason and the existing levels of debt are not too high. Borrowing to undertake major infrastructure build outs such as airports, hospitals and roads, allows expensive projects to be done earlier, all of which benefit the economy and the population more quickly. Borrowing to fund unexpected and unbudgeted costs such as covid for example, allows subsequent budgets to proceed along "normal" lines rather than having to be cut to pay for something that has already happened, that had no benefit to the economy.

 

Servicing the debt each year is a tricky balancing act, the problem is that excessive debt becomes difficult to service and only leads to new debt, unless the country is disciplined and is able to avoid becoming addicted.

 

Thailand learned its lesson from the 1997 crash, thereafter its debt load was small to non-existent and every year the same level of budget was put forward, for several years the debt level was reduced to low levels. But it's difficult to build roads, airports etc using revenue income alone, especially when not many people pay tax and those taxes don't increase.  If you look at the graph below you'll see the country's debt to GDP ratio over the years and you'll see how covid has affected things. If you dig in to each years debt, you'll see that most of it resulted from subsidies to the poor and for agriculture, in other words, government giveaways in order to stay in power.

 

https://tradingeconomics.com/thailand/government-debt-to-gdp

 

 

 

[john donson]

what did spending MORE money then you have ever worked out good, instead of limiting the spending

 

how they call this in the private sector :   bankruptcy

 

fighter jets, submarines, rice and other scams  

 

more spending is more sticky fingers at the top

 

[billd766]

On 9/20/2024 at 5:41 PM, chiang mai said:

Yes, but you can argue this a number of different ways. You could say that at least the country doesn't have massive social security/pension costs hanging over its head plus it's free of unions. Plus the debt level is not that high by comparison and it's all Thai debt, not foreign. In those regards the country is still its own master and not obligated externally. Western countries are now on the cusp of having to take things away from citizens because of massive debt overhang, Thailand at least is still at that point where it has an opportunity to get the way forward right, for everyone's benefit.

Debt is debt no matter which way you look at it. It has to be repaid whichever way you look at it, and it costs more money than you borrowed, including interest to repay it.

[chiang mai]

Just now, billd766 said:

Debt is debt no matter which way you look at it. It has to be repaid whichever way you look at it, and it costs more money than you borrowed, including interest to repay it.

If borrowing to build infrastructure enables and improves the economy, the debt will more than pay for itself. That's what the IMF recommended Thailand does, build infrastructure. That means goods can move into and out of the country more easily and suppliers can fill orders more quickly. That translates into more jobs and better productivity.

[kickstart]

On 9/20/2024 at 11:56 AM, chiang mai said:

60% of GDP is not big by international standards, neither is 70. 

97.60 percent

---

The United Kingdom recorded a Government Debt to GDP of 97.60 percent of the country's Gross Domestic Product in 2023.

122.30 percent

---

The United States recorded a Government Debt to GDP of 122.30 percent of the country's Gross Domestic Product in 2023.

I know the Thai economy is far from good, and the future is not looking so good, but looking at the above, I think we are better off in Thailand.