The National Economic and Social Development Board (NESDB) is transforming fiscal policy towards sustainability, emphasizing Thailand's potential before hosting AM2026.

The National Economic and Social Development Board (NESDB) is transforming the financial system towards sustainability, a significant step that reinforces Thailand's potential before stepping onto the world stage as host. AM2026

Fiscal Policy Office (FPO) Organized an academic seminar “Fiscal Transformation: Transforming Thailand's Finance towards Sustainability” The objective of the event was to present policy ideas from the new generation of civil servants of the FPO, as well as to listen to and exchange opinions from over 400 experts, academics, government agencies, and relevant private sectors. The event discussed approaches to national fiscal reform to address the structural economic and social challenges Thailand faces, and to recommend appropriate and sustainable fiscal policies. This aligns with Thailand's commitment to preparing for hosting the IMF-World Bank Group Annual Meetings (AM2026) in 2569.

Decoding Fiscal Risk: A Map, Compass, and Measure of Sustainability

In the morning of the seminar, there was a presentation of academic work by NESDB officials on the topic “Fiscal Transformation: Mastering Risks to Secure the Future: Decoding Risks into Lessons for Success.” By analyzing and decoding "fiscal risks" in 3 dimensions as follows:

• Economic and social structural dimensions: The Thai economy and society post-COVID-19 face structural challenges, including inequality, an aging society, declining competitiveness, changes in market structure and consumer behavior, as well as external and natural factors, which create vulnerability in the fiscal sector.
• Fiscal dimension: Thailand still has fiscal space for additional debt, but this must be done with caution. The government should preserve fiscal space to withstand future crises by expediting fiscal rebalancing to stabilize public debt, enhance government efficiency, and enhance revenue collection capacity.
• Legal dimension: Thailand's fiscal discipline criteria are found to promote overall fiscal sustainability and provide a flexible mechanism for crises. However, the budget deficit level over the past two years has exceeded the point conducive to maintaining public debt stability. Without fiscal balancing, the public debt-to-GDP ratio could exceed the statutory ceiling.

Decoding fiscal risks from these three interconnected dimensions will enable systematic planning of fiscal rebalancing. This will result in a "map" that helps understand fiscal obstacles and risk factors; a "compass" that identifies risks and determines the appropriate direction for future fiscal rebalancing; and a "gauge" that accurately captures the timing and indicates the state of the fiscal sector, signaling the government to design appropriate fiscal policies in various situations.

Elevating Fiscal Policy to Sustainable Prospects: A Key Role for Hosts AM2026

The afternoon session of the seminar featured a panel discussion titled "Fiscal Transformation: Shaping Policies for Sustainable Change: Elevating Fiscal Policy to Sustainable Hope." The panelists included Dr. Pornchai Thiravej, Director-General of the Fiscal Policy Office, Mr. Danucha Pichayanan, Secretary-General of the National Economic and Social Development Council, Dr. Pongthorn Pokkermdee, Deputy Permanent Secretary of the Ministry of Public Health, and Mr. Smith Banomyong, Executive Vice President of Gulf Energy Development Co., Ltd. Participants agreed that Thailand faces structural economic and social challenges that impact its fiscal capacity. These include lower-than-average economic growth rates than the average for emerging markets that are not dependent on energy resources and commodities, rising public debt, limited fiscal space, declining government revenues and rising government expenditures, and other challenges, such as the transition to the digital age and climate change. Therefore, it is imperative to urgently enhance the fiscal sector, particularly by increasing the efficiency of revenue collection and managing government expenditures for maximum benefit, to ensure long-term fiscal and economic sustainability. In terms of fiscal policy, The Director-General of the Fiscal Policy Office has proposed measures to increase revenue collection capacity by adjusting the Value-Added Tax rate, expanding the personal income tax base, and levying new taxes to meet international standards. This approach, coupled with increasing the efficiency of government asset allocation, emphasizes structural solutions. This aligns with the Secretary-General of the National Economic and Social Development Board, who has proposed fiscal reform through four approaches: revenue restructuring, spending efficiency reform, sustainable public debt management, and reforming the role of the public sector and promoting private sector participation.

The Deputy Permanent Secretary of the Ministry of Public Health addressed four threats to Thailand's public health finances: an aging society, a low birth rate, loss of health from non-communicable diseases (NCDs), and inequality in public health services, all of which impact the country's competitiveness. He proposed standardizing health funds for different population groups, creating incentives for primary care, accelerating the creation of a health data hub, and utilizing artificial intelligence (AI).

Regarding the private sector, the Deputy Managing Director of Gulf Energy Development Public Company Limited pointed out that government tax collection has impacted businesses and that current tax collection tools are not aligned with the current situation. Therefore, he proposed increasing tax collection efficiency, bringing informal sector workers into the tax system, reviewing tax reduction measures, analyzing new industries to identify tax collection channels, and proactively managing state assets to increase revenue.

Thailand is ready to host AM2026 reinforces confidence on the world stage

The discussion on fiscal sustainability reforms at this Fiscal Policy Office academic seminar reflects the perspective of the Thai Ministry of Finance, which is aligned with the agenda of the IMF-World Bank Group Annual Meetings (AM2026) that Thailand will host. This will be an opportunity for Thailand to showcase its vision and role in driving solutions to global economic and financial problems, aiming towards stable and sustainable development goals, in line with the goal of creating Thailand's New Horizon: Empowering People, Building Resilience.