Thailand’s fiscal position remains strong despite slower GDP growth, PDMO says
The office emphasized that the country’s public debt is still within the 70% ceiling, despite potential additional borrowing.
The Public Debt Management Office (PDMO) has confirmed that Thailand’s fiscal status remains stable despite slower-than-expected growth of the gross domestic product (GDP).
The office emphasized that the country’s public debt is still within the 70% ceiling, despite potential additional borrowing. It also believes that raising the debt ceiling would not affect the country’s credit confidence, citing strong fiscal fundamentals.
Responding to reports that the government may issue an emergency borrowing bill to cushion against possible impacts from reciprocal tariff measures by US President Donald Trump, PDMO Director Patchara Anantasilp clarified that the country’s fiscal condition remains stable, with no signs of immediate risk, despite the lower-than-expected economic growth.
However, should the government choose to stimulate the economy through additional investment beyond the current budget, it might need to raise the public debt ceiling from the current 70% of GDP, he said.
When asked whether increasing the ceiling to 75–80% would impact investor confidence, Patchara said it would not, given Thailand’s strong fiscal fundamentals.
He added that the PDMO has discussed with several credit rating agencies and assessed external risks, particularly the uncertainty surrounding foreign policy. It projected that private sector investment could slow down in the second half of the year, with public investment expected to play a key role in driving the economy.
An analysis by the PDMO under the assumption of continued budget deficits, without new emergency borrowing, shows that by 2026, if GDP grows by 3%, the public debt-to-GDP ratio will be 67.3%. If GDP growth slows to 2%, the ratio would rise slightly to 68%. Even in a worst-case scenario of zero GDP growth, public debt would still remain under the 70% ceiling.
As of fiscal year 2025, Thailand’s public debt stands at 12.1 trillion baht, or 64.21% of GDP. The government borrowed 860 billion baht to cover the budget deficit and still has a 4 billion baht borrowing margin available. If additional borrowing is required, the government can also utilize rollover funds from previous years, amounting to tens of billions of baht, said Patchara.
“Should the government need to borrow beyond the budget deficit, it can do so under Article 172 of the Constitution, which allows emergency borrowing for the benefit of maintaining economic stability,” he said. “This article permits the issuance of a Royal Decree equivalent to a legislative act in situations deemed urgent and unavoidable by the Cabinet.”
