New Thai Cabinet Announces Policy

Prime Minister Yingluck Shinawatra delivered the Policy Statement of her government to the National Assembly on Tuesday 23 August 2011.  The three core pillars of the government's policy are:

1. To bring about a strong and balanced economic structure for the country, which will be an important basis for sustainable growth with quality. Development in the quality and health of Thai people of all ages is also a determining factor for survival and competitiveness of the Thai economy.

2. To bring about a Thai society that is reconciled, based on the rule of law which meets the international standard, whereby all Thais are treated equally.

3. To prepare Thailand for the arrival of the ASEAN Community in 2015, by strengthening the country in the economic, social, cultural, political and security aspects.

Highlights of Ms. Yingluck's economic policies:

I. Policies Relating to the Internal Economy


* Alleviate difficulties of people and entrepreneurs as a result of inflationary pressure and high oil prices.

- Delay collection of the Oil Fund for certain kinds of fuel with a view to immediately lowering the fuel prices and restructuring energy prices with the aim of reflecting the cost price of energy.

- Monitor the prices of consumer goods and energy to ensure that the price levels will be suitable and fair to consumers and producers. Address the problem of the high cost of living by monitoring the prices of goods as well as income with a view to increasing people’s purchasing power and preventing and solving the problem of direct and indirect monopoly.

* Raising people’s standard of living by enhancing domestic purchasing power and creating balance and strength with quality in the macroeconomic system.

- Freeze the household debts of small farmers and low-income earners with debts less than Baht 500,000 Baht for at least 3 years; carry out debt restructuring for those with debts of more than Baht 500,000 Baht; and, formulate a comprehensive occupation revival plan and production restructuring plan so as to create the opportunity to raise the quality of life through stable income and the ability to pay off debts.
- Enable a worker to earn not less than Baht 300 per day and a bachelor’s degree holder to have an income of not less than Baht 15,000 per month which will be in line with his/her productivity and efficiency; implement counter-measures to reduce the burden of entrepreneurs whom have been affected by the abovementioned measures so that workers and personnel can make a living with dignity and a decent quality of life.


* Reduce Corporate Income Tax to 23% in 2012 and to 20% in 2013 so as to generate competitiveness of the private sector, to broaden the tax base and to support entry to the ASEAN Community in 2015.


* Improve people’s access to sources of funding: Provide support for micro-credit provision, especially credit for low-income earners; increase public welfare to take care of the community; provide sources of funding to entrepreneurs and people through the following measures:
- Increase the Village and Urban Community Fund to Baht 1 million for each unit.
- Establish a fund to develop women’s roles with an average funding amount of Baht 100 million for each province.
- Establish a fund of Baht 1,000 million for participating universities to promote the creation of small entrepreneurs and enable them to borrow money supported by a “business incubator” service within educational institutions and to create innovative enterprises which will drive the economy.
- Allocate funding to the SML fund for community and village development to the amount of Baht 300,000, Baht 400,000 and Baht 500,000 corresponding with the village size in order for villages to manage for their own development.

* Raise the price of agricultural products and enable farmers to gain access to sources of investment by ensuring that prices of agricultural products remain reasonably stable, reflecting global market price mechanisms, by utilizing marketing management and futures markets. Support farmers to sell their products at reasonably high prices compared to their costs. Implement a crop insurance scheme in order to provide income security for farmers, beginning with long grain rice and fragrant Hom Mali rice with moisture not exceeding 15% at Baht 15,000 Baht and Baht 20,000 Baht per cart, respectively. Provide remedies to farmers whose crops are damaged by natural disasters. Establish a registration system for farmer households and issue credit cards for farmers.


* Expeditiously increase income generation from domestic and in-bound tourism by proclaiming 2011-2012 as the “Miracle Thailand” Year and invite foreign tourists to join in the celebrations on the auspicious occasion of His Majesty the King’s 84^th Birthday Anniversary.


II. Policies relating to the external economy:

- Enhance competitiveness and broaden market access for industry business, domestic services business and business of small and micro community enterprises by integrating them into the creative economy so as to produce goods and services with high value and quality while promoting a knowledge-based, skill-based and creative society; and, support innovation from research and development and traditional knowledge-based product branding, especially for arts and crafts, community products and jewelry.

- Encourage expansion of Thai entrepreneurs’ investment in neighboring countries that are able to supply labor and factors of production to bring forth economic prosperity for the country and the region. Attract foreign investment in the manufacturing and service sectors that require high value technology and are environmental friendly, as well as provide technology transfer for Thais; attract investment in building public infrastructure and new cities in appropriate areas; and, amend rules and regulations to provide an environment that facilitates investment and investors.

-Promote and expand integration in the areas of economics, trade, investment and finance to enhance mutual benefits under cooperative frameworks and international trade agreements - bilateral and multilateral; put in place preparedness measures; and, enable businesses and citizens to search for new opportunities and become more resilient.

For the complete Policy Statement of the Council of Ministers, please click here.