Yet another huge loan

Deputy Prime Minister and Finance Minister Pichai Chunhavajira recently declared Thailand may need to borrow as much as 500 billion baht to fund a major economic stimulus package, to soften the anticipated impact on global trade in which the economy will be hard hit by the United States' policy imposing a 36% tariff on Thai imports.

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The borrowing plan idea emerged after the International Monetary Fund (IMF) downgraded Thailand's 2025 economic growth forecast to a mere 1.8% from 2.9%, lowest among Southeast Asian nations.

The World Bank similarly slashed its projection to 1.6% from 2.9%, according to its latest East Asia and Pacific economic update.

Mr Pichai said the proposed stimulus must be substantial enough to produce a huge momentum and trigger plenty of domestic consumption.

It must include enough to provide soft loans to local businesses affected by global trade wars.

Needless to say, the economy will face unprecedented challenges if the trade war comes to pass. A bigger question is whether borrowing on such a scale has merit, and whether it will be possible without producing massive side-effects.