Bangkok: Ms. Sirikanya Tansakul, an MP for the party list and deputy leader of the Prachachon Party, has voiced her concerns regarding the proposal by former Prime Minister Mr. Thaksin Shinawatra for the government to purchase bad debts from citizens. Her apprehensions center around the potential for this initiative to mimic the contentious digital wallet scheme.
According to Thai News Agency, Ms. Sirikanya questioned the practicality of the plan, highlighting the sheer volume and value of non-performing loans (NPLs), which stand at 1.2 trillion baht. Although banks typically do not sell these debts at full value, she estimated that the government would still require at least 300-500 billion baht to negotiate purchases with commercial banks. She pointed out that existing asset management companies, which number around 87, collectively manage only about 300 billion baht in debts, suggesting a significant funding gap.
Ms. Sirikanya also expressed skepticism about the financing of this initiative, noting that Mr. Thaksin claimed no government funds would be used. She questioned the source of the funds and discussed the mixed success of similar fundraising efforts in other countries. Furthermore, she raised concerns about plans to remove debtors' names from credit bureaus, arguing that it could hinder their ability to borrow in the future without a credit history.
She emphasized the need for clarity on how the initiative would benefit debtors, suggesting that the more the government pays for the debt, the more debtors might ultimately have to repay. Ms. Sirikanya also called on the media to seek further details from Mr. Thaksin or Prime Minister Ms. Paethongtarn Shinawatra about their discussions on the matter.
Ms. Sirikanya reiterated that this debt-buying proposal is not a novel idea and criticized the government's inaction on her previously expressed economic visions. She suggested that Mr. Thaksin's recent visit to Phitsanulok Province might have prompted the proposal as a means to appeal to citizens facing financial difficulties.
When questioned about the proposal's efficacy in addressing Thailand's systemic debt problems, Ms. Sirikanya expressed doubt. She argued that commercial banks would be the primary beneficiaries, as they could offload bad debts, while the broader economic outlook remained bleak. Moreover, she warned that public perception of government intervention might dissuade individuals from repaying their debts, posing a further risk to the economic system.
Ms. Sirikanya criticized the lack of a clear stance from the Ministry of Finance, noting that Deputy Prime Minister and Minister of Finance Mr. Pichai Chunhavajira appeared uncertain about the feasibility of the plan. She also voiced concerns about Deputy Minister of Finance Mr. Chulaphan Amornvivat's seemingly inconsistent communication, drawing parallels to the digital wallet project and warning of potentially greater repercussions.