HOUSEHOLD DEBT
Household debt increase under control: Sommai
The Nation

BANGKOK: -- The steep rise in Thailand's household debt has eased after skyrocketing during 2011-13 following the then government's populist policies.

In the fourth quarter of last year, household debt stayed at 85.9 per cent of the country's gross domestic product (GDP) and bad debt stood at 3.1 per cent.

Finance Minister Sommai Phasee said that the rise in the household debt-to-GDP ratio had started to slow after soaring from 70.6 per cent in late 2011 to 77.3 per cent in 2012 and 82.3 per cent in 2013.

The rise came mainly from the previous government's populist policies, including the first-car and first-house schemes, he said.

Since then, the ratio rose at a declining rate to 85.9 per cent in the fourth quarter of last year.

However, there was no concern over household bad debts, which remained low at 3.1 per cent of total household debt on average, Sommai said.

Among household debts, personal loans and housing loans have seen bad debts at 4.7 per cent and 3.4 per cent respectively, higher than the average.

In the fourth quarter of last year, household debt totalled Bt10.43 trillion, about 85.9 per cent of the country's GDP. Of the total, housing debt accounted for 27 per cent, auto hire purchase 16 per cent, credit-card loans 3 per cent, non-bank personal loans 3 per cent, business loans 17 per cent, cooperative loans 15 per cent and other consumer loans 19 per cent.

Sommai said there were no worries over collateralised loans. However, it was relatively difficult to control non-collateralised loans like consumer loans, credit card loans and personal loans. Such loans account for 25 per cent of total household debt.

He said that several factors, including the capability to access credit, should be taken into consideration in comparing household debts among countries.

To solve the household debt problem in the long term, people should be encouraged to get more income through income distribution and narrowing disparity, Sommai said.

Earlier, the government had approved a Bt40-billion budget increase for the village fund. In April, three nano-finance companies have been set up. Presently, there was about Bt100-billion underground debt, or 1 per cent of household debt in the system, but the real figure may be higher at 2 per cent, Sommai said.

Source: http://www.nationmultimedia.com/business/Household-debt-increase-under-control-Sommai-30257758.html


-- The Nation 2015-04-10

So who is controlling the household debt ?

Loansharks ?

'To solve the debt problem people are encouraged to get more income'

This might the worst advice I've ever heard. Maybe this man could advice people not to borrow money or just cancel their credit cards. Don't live beyond your means.

Just like the UK elections. Blame the previous government for all your woes.

next year everybody happy again with the 20% increase for thais only off course

but ... will the price of everything also not increase, aka INFLATION ?

thai economics

or ... how to never save for a rainy day, because tomorrow you can be dead ... and you are free of your debt

So who is controlling the household debt ?

Loansharks ?

Yes, otherwise known as banks.

I always thought thais would be different but I was wrong of course they buy things they cant afford try to keep up with the jones's racking up debts borrowing money they cant pay back its a never ending cycle .

“Since then, the ratio rose at a declining rate to 85.9 per cent in the fourth quarter of last year.”

So the Junta has begun to control the household debt problem by doing something different than the previous government's populist policies that Sommai blames for rising household debt, right?

WRONG.

“household debt reached 85 percent of the gross domestic product (GDP) in the fourth quarter of 2014, up from 84 percent the quarter before.” National Economic and Social Development Board deputy secretary-general Chutinart Wongsuban, 2015-02-24.

“The country’s household debt soars to 80 per cent in seven years, a highest increase in the world, Finance Minister Sommai Phasee said.” 2015-04-01

Household debt has risen under the Junta. Ironically the cause has been the numerous populist policies pursued by the Junta!

After another quarter of more household debt, I expect Sommai’s next spin (assuming he's still Minister) will be that high household debt is actually a good thing. It will show consumer confidence in the economy or there will be a survey showing that people aren’t concerned about high debt because the Junta has made them happy.

Just like the UK elections. Blame the previous government for all your woes.

who else to blame there neighbour..all governments are responsible for the debt.by allowing easy credit to happen..ie..worry about it later..but lets not forget the bankers who caused the financial collapse with no harm to them or there bonuses..or any convictions.......labour/tories SAME SAME..

“Since then, the ratio rose at a declining rate to 85.9 per cent in the fourth quarter of last year.”

So the Junta has begun to control the household debt problem by doing something different than the previous government's populist policies that Sommai blames for rising household debt, right?

WRONG.

“household debt reached 85 percent of the gross domestic product (GDP) in the fourth quarter of 2014, up from 84 percent the quarter before.” National Economic and Social Development Board deputy secretary-general Chutinart Wongsuban, 2015-02-24.

“The country’s household debt soars to 80 per cent in seven years, a highest increase in the world, Finance Minister Sommai Phasee said.” 2015-04-01

Household debt has risen under the Junta. Ironically the cause has been the numerous populist policies pursued by the Junta!

After another quarter of more household debt, I expect Sommai’s next spin (assuming he's still Minister) will be that high household debt is actually a good thing. It will show consumer confidence in the economy or there will be a survey showing that people aren’t concerned about high debt because the Junta has made them happy.

Its a fun with numbers game. I can see where debt is no longer climbing as banks are tightening loan qualifications. Even the house we live in has a ceiling and I think we are reaching the debt ceiling. Yu can only tap so many lines of credit and borrow from only so many loan sharks and then well time to pay the piper

To solve the household debt problem in the long term, people should be encouraged to get more income through income distribution and narrowing disparity, Sommai said.

Better explain this, Kuhn Sommai, to your chums among the bloated captains of Thai industry currently fighting tooth and nail against raising the derisory minimum wage

How long, do you reckon, they would manage to survive on 300 baht a day?).

It would be interesting to hear how one can expect to "redistribute income" and "narrow disparity" in a country where a privileged elite is busy consolidating its position at the top of the economic pyramid with the help of un-elected government drawn almost exclusively from the top drawer of Thai society.

One obvious way, of course, would be to demand a greater financial contribution from the wealthy. But is this likely to get the green light from a PM and cabinet of mostly dollar millionaires?

Or what about a new "crack-down" targeting those Thai Untouchables - the mega-rich who use tax evasion experts and offshore havens to avoid paying their fair share to the Kingdom's kitty?

Forget it.

From East to West, when money's tight the soft option is to soak the poor by holding down wages and cheeseparing the social welfare budget. This is why more than half of all public school children in the world's richest country live in poverty and why the biggest growth industry in "booming" Britain is food banks for the broke and hungry.

Apart from the actual debt figure it needs to be mentioned that the other side of the measure being used is also struggling. The current GDP predictions seem overly optimistic especially given the potential drop in exports of 4% mentioned yesterday. The only way of keeping GDP positive this year looks to be massive public spending and adding to govt debt.

Edited April 10, 201511 yr by Orac

'To solve the debt problem people are encouraged to get more income'

This might the worst advice I've ever heard. Maybe this man could advice people not to borrow money or just cancel their credit cards. Don't live beyond your means.

+1...Sounds easy enough...