Huge economic-stimulus package to be unveiled today

The government will today unveil an economic-stimulus package worth Bt30 billion to Bt40 billion and plans to inject more money into the economy to help those hardest hit by rising energy costs, especially low-income groups.

Finance Minister Surapong Suebwonglee said the Cabinet was expected to approve a package of measures proposed by the Finance, Energy and Transport ministries. High on the list is a Finance Ministry proposal to cut excise tax on E85 gasohol from Bt2.5795 a litre to 50 satang.

The Cabinet will also be asked to approve government coupons for the poor, in order to help reduce the cost of living for those worst affected by rising prices. Families with a monthly income of Bt6,000 or less will be given coupons to buy basic necessities at subsidised prices or obtain free public services.

The National Economic and Social Development Board will identify those qualified to receive the coupons.

Overall, these and other undisclosed measures are worth an estimated Bt30 billion to Bt40 billion, said Government House sources.

The government will also consider increasing the budget deficit in fiscal 2009 beyond the currently planned 2.4 per cent of gross domestic product if the economic slowdown worsens.

The fiscal-2009 budget, which is now before Parliament, provides for expenditure of Bt1.835 trillion, while revenue is expected to be Bt1.585 trillion. However, the budget's mid-year spending could be increased by running a larger fiscal deficit in fiscal 2009, which begins this coming October 1.

Surapong said liquidity could start to tighten in the second half of the year as US and other foreign investors abandon the local bourse because of the deepening consequences of the US sub-prime mortgage crisis.

On mega-infrastructure projects, implementation of which has failed to advance, Surapong said the govern-ment would begin construction this year on at least one mass-transit line: the Purple Line linking Bang Sue and Bang Yai.

Government House sources said additional measures to help the poor would include free tap water for households consuming less than 50 units a month and free electricity for households using less than 150 units a month.

As well, the Interior Ministry will provide 700 public buses in Bangkok that will give free rides to passengers presenting government coupons.