Thailand Planning $1.6bn Bond Issue to Plug Deficit

 

Thailand plans to issue 55 billion baht ($1.61 billion) of government savings bonds this month to help finance a budget deficit, a Finance ministry official said.

The bonds will go on offer between June 13 and June 30 and will be the last batch of a record 165 billion baht issue planned for the current fiscal year ending September, up 33% from the previous year.

Five-year and 10-year bonds will be offered to the public with yearly average coupons of 2.9% and 3.6%, respectively, said Patricia Mongkhonvanit, head of the ministry’s public debt management office (PDMO).

Last month, the government approved the overall borrowing of 1.4 trillion baht for the 2022 fiscal year. For the 2023 fiscal year starting in October, total borrowing should be lower as there would be no special borrowing for pandemic response measures, Mongkhonvanit said.

 

 

Thailand Public Debt

Thailand’s overall public debt carries an average interest rate of 2.3% per year, she said.

With interest rates on an upward trend, the PDMO has largely shifted to fixed-interest rate borrowing from floating ones.

Thailand’s economy expanded 2.2% in the first quarter from a year earlier, its National Economic and Social Development Council said, as the kingdom lagged behind its Association of Southeast Asian Nations peers.

“A revival is seen in tourism and services exports but is still a long way to full recovery,” Chua Han Teng, economist at DBS Group Research, said.

 

• Reuters, with additional editing by George Russell

 

 

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