Thailand’s Cabinet approves 157 billion baht funding to counter US tariff impact
The government will shift the fund that had been allocated for its flagship ‘digital wallet’ scheme to investment in water management, transport and logistics projects, and for soft loans for small businesses
[BANGKOK] Thailand’s Cabinet has reallocated 157 billion baht (S$5.9 billion) of budget spending away from a consumer stimulus scheme to fund projects in the coming months that will help counter the impact of US tariffs, the government said on Tuesday (May 20).
Thailand faces a 36 per cent US tariff if a reduction cannot be negotiated with Washington before a moratorium expires in July. The US has set a 10 per cent tariff for most nations while the moratorium is in place.
The government will shift the US$4.7 billion that had been allocated for the next stages of its flagship “digital wallet” scheme to investment in water management, transport and logistics projects, and for soft loans for small businesses.
“The digital wallet has not been cancelled, but we need to review how to use this money to stimulate the economy as much as possible,” Prime Minister Paetongtarn Shinawatra told reporters.
The draft budget Bill for 2026, which was also approved by Cabinet, will contain further support measures, she said.
The budget Bill, which projects a 0.7 per cent rise in spending to 3.78 trillion baht and a 1 per cent drop in the deficit to 860 billion baht, will be debated in parliament later this month.
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Deputy Finance Minister Julapun Amornvivat said that projects using the US$4.7 billion funding must be approved by September, as the tariffs will hit the economy in the second half of the year.
“We’ll accelerate injecting the money in the third quarter because the third and fourth quarters are expected to be heavily affected by the tariff issue,” he added.
South-east Asia’s second-largest economy grew by an annual 3.1 per cent in the first quarter, but state-planning agency on Monday slashed its full-year growth forecast range by a percentage point to 1.3 to 2.3 per cent because of the tariffs.
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The economy expanded 2.5 per cent last year, lagging peers.
Earlier on Tuesday, Finance Minister Pichai Chunhavajira said that Thailand wanted a fair trading relationship with the US.
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