Thailand's Public Debt At 41.06% Of GDP

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PUBLIC DEBT

Public debt at 41.06% of GDP

The Nation

BANGKOK: -- Thailand's public debt stood at Bt4.36 trillion or 41.06 per cent of gross domestic product at the end of January, when the government's four borrowing decrees to finance post-flood investment were not yet endorsed.

The public debt ratio in the month fell from 43 per cent, due to a decree that approved the transfer of Financial Institutions Development Fund’s Bt1.14 trillion debt obligation from the Finance Ministry to the Bank of Thailand.

The post-flood borrowing schemes, endorsed in March, are expected to boost the ratio to nearly 60 per cent in 2013.

The Public Debt Management Office’s data shows that in January, of total debt, an amount of Bt3.12 trillion belonged to the government; Bt1.08 trillion to non-financial state enterprises; and Bt167.27 billion to specialised financial institutions.

Compared to December, the public debt increased by Bt64.46 billion, mostly due to borrowing of state enterprises.

Of total, Bt343.79 billion or 7.88 per cent are denominated in foreign currencies. Meanwhile, only 42.4 billion or 0.97 per cent of the outstanding was short-term or loans with maturity of 12 months or lower.

-- The Nation 2012-04-10

[soi41]

The 60 % reached next year is according to the guidelines the maximum. And with no 1.14 trillion to move to BOT, what to do ? Oh, I forgot: Ofcourse we lower our holding in PTT, gives a nice cashflow for the moment and more importantly PTT's accumulated debt is by magic not public debt anymore. If I had had a accountant like that back home, I would be a very rich man. Feel sorry for the next generation of Thais.

[JohnnyGray]

Still, compared to many other nations it's not so bad (USA 62%, Japan 191%, UK 76%, Singapore 106%) and the floods were a once in a lifetime occurrence, hopefully.

And with the Baht having risen in value steadily over the last 20 years, apart from one or two hiccups, they can easily afford to service old debts which have fallen in value in real terms and raise new finance on the open market. There are plenty of buyers out there for Thai Government Bonds. In comparison, it's much more difficult and expensive for Greece, Spain and Italy to raise funds.

[midas]

Still, compared to many other nations it's not so bad (USA 62%, Japan 191%, UK 76%, Singapore 106%) and the floods were a once in a lifetime occurrence, hopefully.

And with the Baht having risen in value steadily over the last 20 years, apart from one or two hiccups, they can easily afford to service old debts which have fallen in value in real terms and raise new finance on the open market. There are plenty of buyers out there for Thai Government Bonds. In comparison, it's much more difficult and expensive for Greece, Spain and Italy to raise funds.

Actually UBS says Japan is 240 % not 191% ?

But this has to be the most stunning headline regarding the whole world....

Total global debt is now over $190 trillion and more than three times global GDP

http://www.mybudget360.com/unsustainable-global-debt-total-global-debt-190-trillion-global-debt-gdp-european-union-financial-crisis/

[cardholder]

I wonder what the percentage would be if you added on the 'black loans' i.e. all the loans lent in the villages against chanotes/gold/log books etc....

[JohnnyGray]

Still, compared to many other nations it's not so bad (USA 62%, Japan 191%, UK 76%, Singapore 106%) and the floods were a once in a lifetime occurrence, hopefully.

And with the Baht having risen in value steadily over the last 20 years, apart from one or two hiccups, they can easily afford to service old debts which have fallen in value in real terms and raise new finance on the open market. There are plenty of buyers out there for Thai Government Bonds. In comparison, it's much more difficult and expensive for Greece, Spain and Italy to raise funds.

Actually UBS says Japan is 240 % not 191% ?

But this has to be the most stunning headline regarding the whole world....

Total global debt is now over $190 trillion and more than three times global GDP

http://www.mybudget3...nancial-crisis/

You're right about Japan, it's now much higher than the source I used, probably because of the loans required to cover the cost of re-building after the last Tsunami and the nuclear disaster. But Japanese savings as a whole are still rising thanks to continued, very substantial current account surpluses because Japanese exports are still very much in demand. It's just that these days the saving surplus is in the corporate rather than the household sector. What their economy needs is for corporates to start spending their cash hoards, and who knows, there may be a bit of that in the wake of the earthquake.

As for the rest of the world, wow! $190 trillion is a big number, but remember it's being paid back to lenders, month by month (even Greece pays it's debts - albeit using Bundesbank money).

Did you read about the British 100 year Government Bond that HM Treasury are planning to sell? At least at my age I wont be paying taxes to pay that off

[midas]

Still, compared to many other nations it's not so bad (USA 62%, Japan 191%, UK 76%, Singapore 106%) and the floods were a once in a lifetime occurrence, hopefully.

And with the Baht having risen in value steadily over the last 20 years, apart from one or two hiccups, they can easily afford to service old debts which have fallen in value in real terms and raise new finance on the open market. There are plenty of buyers out there for Thai Government Bonds. In comparison, it's much more difficult and expensive for Greece, Spain and Italy to raise funds.

Actually UBS says Japan is 240 % not 191% ?

But this has to be the most stunning headline regarding the whole world....

Total global debt is now over $190 trillion and more than three times global GDP

http://www.mybudget3...nancial-crisis/

You're right about Japan, it's now much higher than the source I used, probably because of the loans required to cover the cost of re-building after the last Tsunami and the nuclear disaster. But Japanese savings as a whole are still rising thanks to continued, very substantial current account surpluses because Japanese exports are still very much in demand. It's just that these days the saving surplus is in the corporate rather than the household sector. What their economy needs is for corporates to start spending their cash hoards, and who knows, there may be a bit of that in the wake of the earthquake.

As for the rest of the world, wow! $190 trillion is a big number, but remember it's being paid back to lenders, month by month (even Greece pays it's debts - albeit using Bundesbank money).

Did you read about the British 100 year Government Bond that HM Treasury are planning to sell? At least at my age I wont be paying taxes to pay that off

according to the Guardian newspaper the British 100 year Government Bond it is unlikely to get off the ground....

" Investors have strongly criticised George Osborne's controversial plan for 100-year gilts, branding them a gimmick and a "lousy investment".'

As for Greece paying its debts they are not likely to be able to do so if they keep having strikes like the ferry strike which started todaywhich will have a terrible impact on the economy?I can't be as optimistic as you because the next one to implode will be Spain and a much bigger problem

[wellred]

Does any of this mean I may get more bhat to the £ in the near future?

[01322521959]

Does any of this mean I may get more bhat to the £ in the near future?

Well, I am certainly crossing my fingers, but wouldn't dare hold my breath..

[Pib]

A country's public debt can be smoke & mirrors calculations. These smoke & mirrors magic tricks keep the taxpayer confused as to what is too much public debt...guess it takes a Greece-type event to clear away the smoke and break the mirrors...and see the true impact and pain.

[JohnnyGray]

It's certainly complicated and the Greeks (11.3 million of them) may have to exit the Eurozone before things get better, fingers crossed for them.

Spain's economic problems pose a far greater threat (46 million population). They're already tightening their belts and unemployment is at 20% for adults and over 50% for 16-18 yr olds. Again, they may have to exit the Eurozone before things get better...but having said that, Ireland and Portugal are still limping along and if the world economy picks up, which it will at some point, then the outlook will improve.

Getting back on track, the Thai Baht is strong at the moment against a basket of currencies.

The British Pound has improved steadily over the past 12 months against its major trading partners in the Eurozone and against the US$ because of its "safe haven" status, history, democracy, legal system, limited corruption, well-governed stock markets, property rights, blue-chip companies etc.. I think over the next 2 years it will also rise against the Baht, why? Because the Bank of Thailand will continue to intervene in the global markets to suppress the value of the Baht to support exports, because Thailand is an export based economy.

It will be gradual, but I can see the Pound rising to 60 Baht from its current 49 Baht level over the next 18 months. Well that's what I'm betting on anyway!

Edited April 10, 2012 by JohnnyGray

[billd766]

It's certainly complicated and the Greeks (11.3 million of them) may have to exit the Eurozone before things get better, fingers crossed for them.

Spain's economic problems pose a far greater threat (46 million population). They're already tightening their belts and unemployment is at 20% for adults and over 50% for 16-18 yr olds. Again, they may have to exit the Eurozone before things get better...but having said that, Ireland and Portugal are still limping along and if the world economy picks up, which it will at some point, then the outlook will improve.

Getting back on track, the Thai Baht is strong at the moment against a basket of currencies.

The British Pound has improved steadily over the past 12 months against its major trading partners in the Eurozone and against the US$ because of its "safe haven" status, history, democracy, legal system, limited corruption, well-governed stock markets, property rights, blue-chip companies etc.. I think over the next 2 years it will also rise against the Baht, why? Because the Bank of Thailand will continue to intervene in the global markets to suppress the value of the Baht to support exports, because Thailand is an export based economy.

It will be gradual, but I can see the Pound rising to 60 Baht from its current 49 Baht level over the next 18 months. Well that's what I'm betting on anyway!

That would be a nice dream but I wouldn't put my grocery money on it.

[scorpio]

Fingers crossed, think i,ll cancel that TT and sit on it a while more.

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