7 June 2024

Thailand’s household debt increased 3.9% to 14.02 trillion baht in the fourth quarter of last year, representing 89.3% of gross domestic product (GDP), said Mr. Danucha Pichayanan, secretary-general of the National Economic and Social Development Council, today.

He noted that the increase, although at a slower rate, was in line with economic contraction and reflected public concern over creating new debt.

He also said, however, that the ability to service household debt has improved, but it still needs to be closely monitored, as the amount of outstanding debt, which does not exceed three months, remains high.

Mr. Danucha said that non-performing loans (NPLs) for the fourth quarter of last year dropped to 2.84%, from 2.9% in the third quarter, thanks to debt restructuring programs introduced by financial institutions to ease the financial burden on their debtors.

He predicted that household debt, as a percentage of GDP, is likely to increase this year due to the economic slump, unemployment problems and the low purchasing power of the public, especially in low-income families.

760,000 people were unemployed in the first quarter of this year or 1.96%, higher than the previous quarter, at 1.86% as a result of the direct impacts of the COVID-19 pandemic, although the employment rate in the farm sector has slightly increased by 0.4%, while employment rates in the industrial and tourism sectors have continued to contract since last year.

Working hours per week, for the first quarter of this year, have dropped for the sixth quarter, by 1.8%, to an average of 40.1 hours.

Looking at the whole employment picture, Mr. Danucha said that more people were employed, particularly in the farm sector, but working hours have dropped, reflecting an under-employment situation, which has led to a drop in the incomes of the employees, for freelancers in particular.

He also expressed concern over unemployment among new college and university graduates, as he predicted that about 4.9 million of them may not find employment because many businesses have been struggling and are unable to take on new staff.