Selected Issues Papers

Assessing Thailand’s Debt Ceiling—Room for Recalibration?

By Seunghwan Kim

May 9, 2025

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Format: Chicago

Seunghwan Kim. "Assessing Thailand’s Debt Ceiling—Room for Recalibration?", Selected Issues Papers 2025, 054 (2025), accessed May 12, 2025, https://doi.org/10.5089/9798229011495.018

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Summary

The pandemic responses and subsequent fiscal stimulus measures have eroded Thailand’s fiscal space, pushing its public debt close to the ceiling of 70 percent of GDP. While this situation generally calls for fiscal prudence to reduce debt levels, it also raises questions about the adequacy of the current debt ceiling. This paper uses various approaches to assess Thailand’s public debt threshold, beyond which debt could become unsustainable or negatively impact growth. Stochastic simulations are used to account for potential impact of macroeconomic and fiscal shocks in calibrating an appropriate debt ceiling for Thailand.

Subject: Asset and liability management, Contingent liabilities, COVID-19, Debt limits, Fiscal governance, Fiscal policy, Fiscal rules, Fiscal space, Fiscal stance, Fiscal stimulus, Government debt management, Health, Public debt, Public financial management (PFM)

Keywords: Contingent liabilities, COVID-19, Debt ceiling, Debt limits, Debt service, Expenditure, Fiscal governance, Fiscal rules, Fiscal rules, Fiscal space, Fiscal stance, Fiscal stimulus, Government debt management

Publication Details

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