Thailand's fiscal stimulus part II, ready to go!
By Jon Fernquest
Fiscal
stimulus
is more effective if the government spends
money quickly.Earlier this year, 2,000 baht handouts to workers earning under 15,000 baht gave quick and effective fiscal stimulus to the Thai economy.
On the other hand, taxpayers want to get long-term benefits from the money they pay the government. Handouts don't provide long-term benefits.
Investment rather than handouts is one way taxpayers get these long-term benefits.
Infrastructure projects are one form of long-term investment but they take longer to get off the ground and running.
Today's article is about how many of these projects are just ready to begin.
Also read Suranand Vejjajiva's critique of Thailand's fiscal stimulus part II, writtten two weeks ago (Read article).
Today's article starts after the vocabulary:
fiscal stimulus -
temporary tax cuts and government spending programmes to get the
economy moving and growing again
effective - gets the job done
handouts - free money and things (given to people without requiring anything in return)
investment - taking your money and putting it into projects to make a profit or earn interest (buying stock shares, bonds, real estate)
infrastructure - basic systems and services such as transportation, electricity, and water that are necessary for a country to run smoothly
get off the ground and running - get a project or business started and operating
critique of Y - a written evaluation and judgement about Y, looking at both strengthes and weaknesses
effective - gets the job done
handouts - free money and things (given to people without requiring anything in return)
investment - taking your money and putting it into projects to make a profit or earn interest (buying stock shares, bonds, real estate)
infrastructure - basic systems and services such as transportation, electricity, and water that are necessary for a country to run smoothly
get off the ground and running - get a project or business started and operating
critique of Y - a written evaluation and judgement about Y, looking at both strengthes and weaknesses
'Strength to Strength' projects closer to launch
WICHIT CHANTANUSORNSIRI14/09/2009
Contracts for the first lot of projects approved under the 1.45-trillion-baht "Thailand: Investing from Strength to Strength" infrastructure programme should be ready for signature within three months.
Chakrit Parapuntakul, deputy director-general of the Public Debt Management Office, said contracts for 200 billion baht worth of projects approved by the cabinet last month would be ready to be awarded within the next three months.
Of the 12 billion baht worth of road maintenance projects proposed by the Highways Department, 70% were ready to award contracts now, with the rest likely to complete procurement procedures by November. For the 16-billion-baht rubberised asphalt roadway programme, contracts are expected to be all awarded by the end of next month.
"These projects are ready to go, and should take no longer than one month following cabinet approval. Most are relatively straightforward, small-scale investment projects. Just the two highway programmes alone amount to 28 billion baht," Mr Chakrit said.
Another 10 billion baht in funds from the programme are ready to be committed almost immediately to increase capital for state-owned banks to support new lending programmes.
project launch (noun) - the starting of a
project
launch project (verb) - start a project
projects closer to launch - approaching the start date for the project
a lot - a group of things
first lot of projects - the first group of projects
"Thailand: Investing from Strength to Strength" infrastructure programme - the second stage of Thailand's fiscal stimulus programme in response to the global economic crisis, money in infrastucture (roads, bridges, irrigation) that will provide long-term benefits for Thailand
ready for signature - ready for approval by authority
authority - the person or organisation with official power to make decisions and give orders
contracts awarded - arrangements to do projects have been made with businesses already (businesses usually selected by a competitive bidding process)
road maintenance - repairing roads
procurement - formal process of buying things
rubberised asphalt roadway - used to resurface roads and highways, made from old tires so helps to reduce old tire disposal also reduces noise of cars (Read Wikipedia and description from State of Arizona)
projects are ready to go - projects can start soon
relatively straightforward - not complex, easy to understand and do
scale of a project - the size of a project (compared to other projects)
small-scale - small (compared to other projects)
funds - money collected for a special purpose (for investment in companies or projects)
commit funds to Y - make promise that project Y will receive funds
funds from the programme are ready to be committed - they are ready to give money to the project
bank capital - money invested in a bank regulated by law
increase capital for state-owned banks - increase the amount invested in government banks
launch project (verb) - start a project
projects closer to launch - approaching the start date for the project
a lot - a group of things
first lot of projects - the first group of projects
"Thailand: Investing from Strength to Strength" infrastructure programme - the second stage of Thailand's fiscal stimulus programme in response to the global economic crisis, money in infrastucture (roads, bridges, irrigation) that will provide long-term benefits for Thailand
ready for signature - ready for approval by authority
authority - the person or organisation with official power to make decisions and give orders
contracts awarded - arrangements to do projects have been made with businesses already (businesses usually selected by a competitive bidding process)
road maintenance - repairing roads
procurement - formal process of buying things
rubberised asphalt roadway - used to resurface roads and highways, made from old tires so helps to reduce old tire disposal also reduces noise of cars (Read Wikipedia and description from State of Arizona)
projects are ready to go - projects can start soon
relatively straightforward - not complex, easy to understand and do
scale of a project - the size of a project (compared to other projects)
small-scale - small (compared to other projects)
funds - money collected for a special purpose (for investment in companies or projects)
commit funds to Y - make promise that project Y will receive funds
funds from the programme are ready to be committed - they are ready to give money to the project
bank capital - money invested in a bank regulated by law
increase capital for state-owned banks - increase the amount invested in government banks
Funding for the 200 billion baht in projects already approved by the cabinet will come from a special spending bill authorising the government to borrow 400 billion baht for new investment as well as cover revenue shortfalls for the fiscal 2009 budget.
The Finance Ministry currently expects 100 billion baht will be needed to shore up the country's treasury accounts, with the remainder available to finance new public investment programmes.
Another borrowing bill, which will also authorise the government to take on up to 400 billion baht in new debt, is due to go to Parliament for debate on Sept 21.
Funds from the second bill will be wholly committed to longer-term projects under the Strength to Strength programme, including financing for five new mass transit lines, irrigation improvements nationwide and funding for the "Creative Economy" initiative.
Mr Chakrit said public borrowing under the investment programme should not disrupt the money markets because liquidity remains plentiful and private investment remains weak.
Authorities hope the Strength to Strength programme, which will finance thousands of projects through 2012, will provide a short-term lift to the economic recovery as well as pave the way for productivity and efficiency gains in the medium term.
funding (noun) -
money for a special purpose, money that pays for a project
authorizing X to do Y - giving permission for X to do Y
shore up Y - make Y stronger
shore up the country's treasury accounts - make the government's financing stronger
take on new debt - borrow more money
authorise the government to take on new debt - give permission to the government to borrow more money
wholly committed to - promising to support in the future
an initiative - a new plan to achieve goals or solve problem
the Creative Economy initiative - a plan in Thailand to increase creativity among the people of Thailand
public borrowing - borrowing by the government
mass transit lines - subways and skytrains that carry large numbers of people to places
disrupt - cause difficulties that prevents normal operation
disrupt the money markets - cause problem in money markets so that they do not operate normally
liquidity - the amount of cash and loans available
liquidity remains plentiful short-term lift to the economic recovery - a lot of cash and loans in the economy which helps the economy recover from the downturn
productivity - producing more for the same amount of resources (labour, capital, machines)
efficiency - doing a task well without wasting time, money, resources
in the medium term - during a period of time that is 2-10 years into the future
productivity and efficiency gains in the medium term - over the next 2-10 years waste less resources and money (efficiency higher) and produce more with given resources (productivity higher)
authorizing X to do Y - giving permission for X to do Y
shore up Y - make Y stronger
shore up the country's treasury accounts - make the government's financing stronger
take on new debt - borrow more money
authorise the government to take on new debt - give permission to the government to borrow more money
wholly committed to - promising to support in the future
an initiative - a new plan to achieve goals or solve problem
the Creative Economy initiative - a plan in Thailand to increase creativity among the people of Thailand
public borrowing - borrowing by the government
mass transit lines - subways and skytrains that carry large numbers of people to places
disrupt - cause difficulties that prevents normal operation
disrupt the money markets - cause problem in money markets so that they do not operate normally
liquidity - the amount of cash and loans available
liquidity remains plentiful short-term lift to the economic recovery - a lot of cash and loans in the economy which helps the economy recover from the downturn
productivity - producing more for the same amount of resources (labour, capital, machines)
efficiency - doing a task well without wasting time, money, resources
in the medium term - during a period of time that is 2-10 years into the future
productivity and efficiency gains in the medium term - over the next 2-10 years waste less resources and money (efficiency higher) and produce more with given resources (productivity higher)
(Source: 'Strength to Strength' projects closer to launch, WICHIT CHANTANUSORNSIRI, 14/09/2009, link)
