Thai government gives $55 to low-income workers

The Jakarta Post, The Associated Press, Bangkok | Thu, 03/26/2009 11:31 AM

Thailand's government began handing out 2,000 baht ($55) checks to millions of low-income workers Thursday to stimulate an economy battered by the global financial crisis.

As the first checks were distributed, thousands of demonstratorsl converged on Government House, the office of Prime Minister Abhisit Vejjajiva, demanding the resignation of the government and rejecting the scheme as a "buy off."

The demonstrators, followers of ousted Prime Minister Thaksin Shinawatra, say Abhisit's government came to power through illegal means. Their earlier demonstrations have proved peaceful.

The so-called "help-the-nation" dole-out scheme targets over 9 million people earning less than 15,000 baht ($424) a month.

"I am confident it will stimulate the economy," Abhisit told reporters ahead of the launch of the 18 billion baht ($509 million) program.

"We are not encouraging extravagant spending. It's a measure we hope will ease the burden on low-income people," he said after personally handing out the first check to a teacher.

Thailand has been hit with the worst economic downturn since the 1997 Asian financial crisis. Southeast Asia's second largest economy grew 2.6 percent in 2008. But the economy's performance this year is expected to contract 2.5 percent as the country's crucial export sector slid four months straight.

Stores and shopping complexes were quick to jump in, hoping to attract check recipients with special deals.

"The check is valued 20 prcent higher if you cash it in at our store," said Chamnan Metapreechakul, senior marketing director for the Mall Group, one of Thailand's largest mall operators. "We expect people to spend it because it's not large enough to save."

Chamnan said the stores have create baskets of products worth 2,200 bah ($61) for those who do not want to think too much about how to spend their windfall.

At the Kentucky Fried Chicken fast food chain, a check can be exchanged for cash coupons with 20 pieces of chicken thrown in for free.

"I am planning to see what the best deal is and spend it there. It feels good tht I am spending to save the country. What an odd concept!" said Narisara Songsawang, a 36-year-old clerk.

The program is expected to increase economic growth by 0.2 percent, Finance Minister Korn Chatikavenij said Wednesday.

The first lot of 5.5 million checks issued Thursday will be followed by 1.2 million in late March and the rest in early April.

Some said they planned to save the money for hard times.

"You watch the news and people are getting laid off daily. I think I will save it in case my husband is the next one to lose his job," said Ponnapa Sintanee, a 38-year-old mother of three. She eans 12,000 baht ($340) a month as a school teacher.

Although the one-time measure was well-received by many, some raised concerns that it only targets about a third of the country's labor force who are registered with the Social Security Fund. Those in the informal sector, including farmers and self-employed people, are not eligible.

Abhisit said the government plans to launch other programs for those left out of the current scheme.

When he became prime minister in December, Abhisit said his government would retain populist policies - including cheap credit and health care - implemented under Thaksin, whohas continued to loom over Thai politics even after his ouster by a military coup in 2006.

The anti-government protesters rejected the scheme Thursday, and demanded that Parliament be dissolved and new elections held. The demonstrators say that the former pro-Thaksin government was illegally removed by court action backed by the powerful military.

"Abhisit used to say he hates populist policies. So what is he trying to do now? Is he trying to buy us off?" said a protest leader, Nattawut Sai-kua. "It is not going to work. We will protest until this illegitimate government is gone."

Thailand was destabilized last year by months of protests by both supporters and opponents of Thaksin, whom his opponents accuse of corruption and abuse of power. He retains popularity among the country's rural majority.

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