Thailand’s Finance Ministry Plans to Sell $1.59 Billion Worth Government Bonds

The Finance Ministry of Thailand has decided to sell 50-billion-baht ($1.59 billion) worth of government savings bonds to the public in the following week to boost the country’s economy recovery.

According to the director-general, Public Debt Management Office (PDMO) Patricia Mongkhonvanit the amount of borrowing will be evaluated with the level of revenues, expenditures, and treasury reserves.

The proceeds will focus on the financing for the budget deficit, and not the coronavirus responses, Patricia added. The PDMO had withdrawn a sum of 338 billion baht under the 1 trillion baht emergency fund.

The bonds will be split in two tranches- 45 billion baht of seven-year bonds with a 2.2% coupon and 5 billion baht of four-year bonds with 1.7% coupon.

Further, the level of borrowing would be gauged by the government if the revenue collection falls by about 300 billion baht or below the target of 9%. As per PDMO, the ratio of public debt to GDP will be reconsidered and increased to 52.4% from the current 45.8% in case the government borrows the full loan amount.

Depending on the GDP growth of Thailand, the ratio of the public debt to that of GDP is expected to grow to 57.8% for the fiscal 2021.