Thai Lawmakers Pass $105 Billion Budget to Counter Virus Shock

(Bloomberg) -- Thailand’s lower house of parliament approved the government’s 3.28 trillion baht ($105 billion) budget, clearing a key hurdle in Prime Minister Prayuth Chan-Ocha’s efforts to boost spending to revive the pandemic-battered economy.

The spending plan for the year starting Oct. 1 was backed by 270 of 500 lawmakers late Friday in Bangkok, with 121 abstaining. The budget bill was cut from 3.3 trillion baht earlier and debated by lawmakers for three days before being put to vote.

Most of the budget will be used to mitigate the impact of the Covid-19 outbreak, which has put Southeast Asia’s second-largest economy on track for its deepest annual contraction ever. The government and the central bank in April unveiled a 1.9 trillion baht stimulus package after exports and tourism slumped.

The budget proposals will be sent to the Senate next week for approval before a royal endorsement allows for disbursement. While a two-week delay is expected for the process to be completed, the Cabinet has set aside money to be used during the interim to prevent a government shutdown.

Thailand’s central bank and the finance ministry both say the economy is on track for its worst year on record, with the latter predicting gross domestic product will shrink 8.5% this year as tourism and trade slump. The country’s previous biggest decline in growth was in 1998 during the Asian financial crisis when it contracted 7.6%, official data show.

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