New Thai PM to prioritise tackling $621b in household liability

Govt to speed up debt restructuring, boost fiscal stimulus to raise economic growth

Thailand's new government plans to expedite sweeping debt restructuring to tackle an estimated 16 trillion baht (S$621 billion) in household liability, offer financial assistance to small businesses and accelerate fiscal stimulus to lift growth.

The debt revamp will cover the entire system, and will be especially targeted at providing relief to borrowers of car and home loans, according to a draft policy statement seen by Bloomberg News.

Prime Minister Paetongtarn Shinawatra is due to announce the plans in Parliament on Sept 12.

The initiative will also cover the informal sector, and will be implemented through state-owned financial institutions, commercial banks and asset management companies.

The government is concerned about household debt that is at more than 16 trillion baht - equivalent to more than 90 per cent of gross domestic product - and rising non-performing loans, Ms Paetongtarn is set to say.

The indebtedness is driving inequality between the rich and the poor, with development concentrated mainly in Bangkok and major cities, the Prime Minister will say.

The policy statement will list out priorities of Ms Paetongtarn's coalition government that is led by her Pheu Thai Party and backed by a clutch of pro-establishment and royalist groups.