Thailand Risks Indonesia-Style Fiscal Crisis, Economist Warns
Thailand Risks Indonesia-Style Fiscal Crisis, Economist Warns
BANGKOK, June 23, 2026 – Thailand faces a growing risk of a fiscal and investor confidence crisis similar to Indonesia’s unless it adopts a credible fiscal rebalancing plan within the next one to two years, economist and People’s Party MP Anusorn Thammajai warned.
Speaking on June 21, Anusorn said Thailand had not yet reached a crisis point but warned that rising public debt and weakening fiscal discipline were increasing economic vulnerabilities.
He compared Thailand’s situation with Indonesia, which despite recording stronger economic indicators, including first-quarter growth of 5.61% and a lower public debt-to-GDP ratio, has experienced a sharp decline in investor confidence since President Prabowo Subianto took office.
Anusorn attributed Indonesia’s market volatility to concerns over fiscal policy, expanding state intervention, questions surrounding central bank independence, and the establishment of PT Danantara Sumberdaya Indonesia as the sole export intermediary for commodities including coal and palm oil. He said those developments contributed to capital outflows, an 8% depreciation of the rupiah and a stock market decline of more than 32%.
Turning to Thailand, Anusorn noted that the proposed 2027 budget projects public debt at 69.36% of gross domestic product, just below the country’s legal ceiling of 70%. He warned that weaker-than-expected economic growth could push debt beyond the limit.
He also said the budget allocates 310.95 billion baht for interest payments compared with 151.52 billion baht for principal repayments, meaning debt servicing costs are roughly twice the amount used to reduce the principal. According to his calculations, interest payments amount to around 852 million baht a day, or approximately 35 million baht an hour.
“If we continue with populist policies, violate fiscal discipline, fail to reform government revenue, and incur more debt to the point where the debt ceiling has to be raised, we risk a fiscal crisis, leading to a crisis of confidence similar to Indonesia’s, with a plummeting currency and a crashing stock market in the future,” Anusorn said.
He also criticised the proposed budget, arguing that increased allocations for several government agencies lacked corresponding improvements in efficiency and that public spending had not adequately addressed evolving geopolitical, security and social welfare challenges.
Anusorn called for a review of the 2027 budget to strengthen fiscal discipline, improve spending efficiency and develop a more integrated welfare system, warning that continued reliance on fragmented welfare programmes and broad-based populist policies could undermine Thailand’s long-term economic stability.
