Democrat Mps Fear Country ‘going Broke’

[george]

Democrat MPs fear country ‘going broke’

BANGKOK: -- Opposition lawmakers yesterday expressed concern that the country was on the brink of going broke as government expenditure has outpaced revenue for the past two years.

“Judging by the fast depleting treasury reserve, the government is nearly broke, regardless of the rosy economic picture it is trying to project,” Democrat MP Korn Chatikavanij said during a House debate on the fiscal report for 2004.

Korn said it was high time for belt-tightening measures, but the government had opted instead to push for costly projects by arguing that it could convince foreign partners to partially shoulder the Bt1.7-trillion investment needed.

The 2004 report has sent a clear signal for the tightening of purse strings, he said.

Even though the country boasted Bt22 billion in treasury reserves last year, the figure was misleading because the government had relied on Bt4.3 trillion in off-budget spending in an attempt to window dress the fiscal situation, he said.

“The off-budget spending soared suspiciously in the final quarter of last year, coinciding with the campaign-related activities for the general election,” he said.

The government suffered deficit spending totalling Bt104 billion for last October and December, but the treasury reserve appeared healthy as authorities drew funds from off-budget sources, he said.

Democrat MP Chinnaworn Boonyakiat said the government should quickly outline its plans to replenish the treasury reserve, which fell at an alarming rate in 2003 and 2004.

“The government has boasted about its success in ensuring a healthy economy but the reality is it that it does not have the money it claims to have in the state coffers,” he said.

Democrat MP Pichet Phanvichartkul warned that the government was pursuing an imprudent fiscal policy in allowing the treasury reserve to fall to Bt36 billion.

“Under accepted fiscal standards, the minimum reserve should amount to about two months of government spending. But it is now equivalent the expenditure for 10 days,” he said.

In his rebuttal, Deputy Finance Minister Varathep Ratanakorn said off-budget spending had already fallen this year from last year.

Varathep argued that the government financing of mega-projects was sound because a major portion of the costs would be met from foreign partners, foreign loans and state enterprises.

--The Nation 2005-12-16

[Kido]

GDP (purchasing power parity): $524.8 billion (2004 est.)

GDP - real growth rate: 6.1% (2004 est.)

http://www.cia.gov/cia/publications/factbook/geos/th.html

The government have to keep spending in order to stimulate to economy during this inflation time ( oil prices ), Thailand have a 6.1 % GDP growth was very good second from China. Wihtout mega project the nation doesn't have enough money in the market to circulate, then it become worst.

Over spending it not a problems if the money go back to the public and not to certain individual pocket.

[penzman]

Thailand have a 6.1 % GDP growth was very good second from China.

<{POST_SNAPBACK}>

As long as thses figures are true...