Thai Parliament Passes $106 Billion Budget in Boost for Economy

(Bloomberg) -- Thailand’s parliament approved the annual budget after a months-long delay, providing a fillip for the country’s struggling economy.

The 3.2 trillion baht ($106 billion) spending plan received the backing of 253 lawmakers Saturday in Bangkok, with 196 abstaining. Outlays were supposed to start Oct. 1 but were delayed by government formation and the legislative process after last year’s general election, which ended a prolonged period under a junta.

The passage of the bill strengthens the pro-military ruling coalition, whose slim parliamentary majority became a little more comfortable after recent by-elections. The vote was viewed as a test of Prime Minister Prayuth Chan-Ocha’s ability to shepherd key legislation through a bitterly divided legislature.

The fiscal plan is set to be implemented from February, based on a government time-line. The ruling alliance could tighten its grip on power if, as many expect, a key opposition party is dissolved by a court in coming weeks.

“It looks like smooth sailing ahead for the government” in parliament, said Paul Chambers, a Thai politics expert at Naresuan University’s College of Asean Community Studies. The coalition is in a stronger position than last year, but the Thai economic slowdown will pose a wider test of its popularity, he added.

Former army chief Prayuth seized power in a 2014 coup and returned as premier at the head of a pro-military alliance after the disputed March election.

A sizable opposition bloc in the lower house questions the administration’s legitimacy, viewing it as a continuation of military control.

A protest against the ruling alliance, in the form of an early morning jog billed as a “Run Against Dictatorship,” is due Sunday in Bangkok. Organizers say 10,000 have registered for the event. A separate walk is scheduled in the capital as a show of support for Prayuth’s leadership.

The Thai economy may expand 2.8% this year, up from a five-year-low of 2.5% in 2019, based on central bank estimates. A surging currency damaged exports and tourism last year.

“The fiscal engine has been taken away from last year’s economic growth momentum, but this year we should expect to see more activities, more impact coming from the fiscal engine,” Bank of Thailand Governor Veerathai Santiprabhob said in an interview Jan. 8.

To contact the reporter on this story: Siraphob Thanthong-Knight in Bangkok at rthanthongkn@bloomberg.net

To contact the editors responsible for this story: Sunil Jagtiani at sjagtiani@bloomberg.net, Natnicha Chuwiruch

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