Academic backs Thai government's investment in mega projects

BANGKOK, October 11 (TNA) - A senior academic says that the Thai government should stimulate the national economy through investment on its 2.2 trillion baht infrastructure development projects, mostly on domestic transportation. When airing the view at a seminar in Bangkok on Thursday, Panupong Nitiprapa, Dean of Thammasat University’s Economics Faculty cited global economic volatility which has affected the Thai economy and exports. Panupong cautioned it would be impossible for the Thai economy to grow at 4 per cent in 2013 if the government did not stimulate domestic investment and consumption to compensate for shrinking exports, referring to Commerce Ministry statistics showing that Thai exports during the first eight months of this year totaling 152.83 billion US dollars, up only one per cent year-on-year. Therefore, Panupong suggested, the Thai government need to stimulate the national economy by, particularly, investing in the mega infrastructure development projects in order to build confidence in the private sector and to stimulate public spending. The dean pointed out that the Thai government could still create more public debt, which now stands between 40-45 per cent of the country's gross domestic product (GDP), still below 60 per cent, which is in line with the fiscal discipline. On an earlier proposal, raised by Ampon Kittiampon, Chairman of the Bank of Thailand’s board of directors, on transferring partially Thailand’s international reserves to set up the national wealth fund for investment in the government-sponsored infrastructure development projects, the dean said it is possible but the Thai government needs to acknowledge on investment in overseas risk assets. According to the dean, investment can be made in Thai government bonds with lower risks but higher yields, while the government, at the same time, has money to invest in those projects. (TNA)