While the “Khon La Khrueng Plus” co-payment scheme is expected to lift year-end spending, the Thai Retailers Association (TRA) has proposed recommendations for strengthening and sustaining Thailand’s economic growth momentum.
Nath Vongphanich, president of the TRA, said following the announcement of the first set of stimulus measures, the association observed encouraging signs of improving consumer sentiment, aided by the fourth quarter being the peak shopping season and an important opportunity for the retail sector to achieve significant sales growth.
He said the co-payment scheme is one of the most effective measures to directly stimulate consumer spending and is expected to increase GDP by 0.21-0.22%, according to Finance Ministry estimates.
The programme plays a crucial role in easing consumers’ cost-of-living burdens during the year-end period while also boosting sales in the retail sector, particularly among small retailers and community-based small and medium-sized enterprises (SMEs), which are key drivers of the grassroots economy.
The measure helps enhance liquidity in the system and creates opportunities for smaller businesses to recover.
The Retail Sentiment Index, a joint survey by the TRA and the Bank of Thailand, indicated retail confidence from October to December has risen to its highest level of the year, reaching a new 12-month high of 63.8 points.
He said this improvement reflects retailers’ growing confidence and optimism towards the new government, as well as key supporting factors such as the year-end festive season and the co-payment measure.
Mr Nath said retailers expect the initiative to increase sales by at least 10%, particularly in consumer goods categories and among provincial retail stores, compared with periods without the scheme.
However, the TRA suggested for the next phase of the co-payment scheme, the government consider expanding participation to include retailers of all sizes, to enhance consumer convenience, provide broader purchasing options and increase the overall effectiveness and inclusiveness of the campaign.
According to the Kasikorn Research Center, the co-payment scheme could inject an estimated 60-70 billion baht into the retail sector, serving as a major catalyst for consumer spending in the final quarter of the year.
The association also proposed the government revive the “Easy E-Receipt” or “Shop Dee Mee Khuen” (Shop and Get Tax Refund) campaign during the final two months of the year to stimulate consumer spending during the high season.
The TRA recommended simplifying participation requirements and expanding eligibility to include all product categories within a spending cap of 100,000 baht, which could generate over 100 billion baht in additional economic activity.
“The key challenge will be whether consumer purchasing power can be sustained after the short-term stimulus measures end. While government programmes have successfully boosted short-term economic activity, structural issues such as household debt and stagnant income levels remain obstacles that must be addressed to ensure sustainable recovery,” Mr Nath added.
LONG-TERM GROWTH
The association emphasised the government should also pursue long-term structural reforms to strengthen Thailand’s economic foundation and sustain growth momentum.
The TRA outlined key recommendations to support this direction including reducing import taxes on lifestyle and fashion products, protect domestic retailers from low-quality and underpriced imports while promoting the “Made in Thailand” certification for SMEs to enhance product credibility and expand trade opportunities both domestically and internationally.
The association also urged the government to enhance workforce skills through upskilling and reskilling programmes and recommended adopting professional standards and competency-based qualifications as benchmarks for wage determination, replacing the traditional minimum wage system.