Thailand's 2027 budget: Business leaders fear insufficient investment for growth

Business leaders in Thailand are expressing concern over the government's fiscal 2027 budget, which allocates only 20.8% to investment expenditure. They fear this insufficient funding will hinder economic growth and undermine the country's long-term competitiveness, despite the budget bill's smooth passage through its first parliamentary reading and the Constitutional Court's validation of a 400-billion-baht loan decree.

“

The government's investment budget should be raised to 25-35% of total annual expenditure to help transform the country.

According to Nonarit Bisonyabut, a research fellow at the Thailand Development Research Institute, the government's investment budget should ideally be between 25% and 35% of total annual expenditure to foster national transformation. However, achieving this target necessitates significant bureaucratic reform. This includes reducing the public sector's size, enhancing its efficiency, and cutting non-essential government spending.

“

This is impossible without bureaucratic reform, reducing the size of the public sector, improving its efficiency, and simultaneously cutting unnecessary government spending.

Bisonyabut emphasized that limiting the discretionary power of government agencies and leveraging artificial intelligence and digital automation for routine administrative tasks are crucial steps. These strategies would not only shrink the public sector but also free up more fiscal resources for productive investments. He also called for a reconsideration of populist measures and agricultural support schemes, such as pledging, price guarantees, and debt moratoriums, arguing they offer temporary relief without promoting long-term adaptation or sustainable income generation.

“

These strategies would reduce the size of the public sector and free up more fiscal resources for productive investment.

Furthermore, Bisonyabut pointed out that some expenditures classified under the investment budget, like canal dredging and road repairs, do not genuinely contribute to the country's future. He noted that dredged soil is often simply piled up, requiring repeated dredging, and that road projects frequently become recurring expenses rather than long-term infrastructure improvements.

“

These programmes represent spending that is quickly exhausted without helping beneficiaries to adapt or generate sustainable future income.