SCB EIC: Clear Gov't Timeline Eases Economic Uncertainty

Post Today•Economy•1d ago

Reader Briefing

SCB EIC forecasts a stable government formation timeline, mitigating economic uncertainty and ensuring policy continuity, though challenges remain regarding fiscal constraints and policy clarity.

•A clear timeline for government formation is expected following the election, reducing political and economic uncertainty.
•The new government is anticipated to begin operations in May, with the FY2027 budget likely delayed by only 1-2 months.
•Bhumjaithai Party's '10 Plus' policy aims for economic growth above 3% but faces challenges due to fiscal limitations and a lack of detailed implementation plans.

Overview

•The period from the dissolution of parliament on December 12, 2025, to the election on February 8, 2026, is estimated to be 2 months.
•The formation of a stable government is estimated to take 5 months in total, including 2 months for electing a new Prime Minister and 1 month for cabinet formation.
•SCB EIC anticipates the new government will begin operations in May, with the FY2027 budget projected to be announced in November 2026, a 1-2 month delay from the usual October 1, 2026 start date.
•The estimated budget for Bhumjaithai Party's 8 policies presented to the Election Commission is 148 billion THB per year, with approximately 30% allocated to direct subsidies.
•Thailand's public debt ratio stood at 64.8% at the end of FY2025 and is likely to approach the 70% ceiling within 1-2 years.
•Moody's and Fitch have adjusted Thailand's credit rating outlook to negative due to fiscal issues, impacting the government's ability to implement policies.
•The projected announcement of the FY2027 budget is likely in November 2026, resulting in a delay of only 1-2 months compared to the normal schedule of October 1, 2026.
•The successful implementation of economic policies faces significant challenges requiring prioritization between short-term stimulus and long-term structural reforms, alongside building confidence with businesses and credit rating agencies.

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Key Quotes

SCB EIC

"Such election results accelerate the formation of a stable government, reducing Thailand's political uncertainty and creating policy continuity in administration."

ผลการเลือกตั้งเช่นนี้เร่งให้เกิดการจัดตั้งรัฐบาลที่มีเสถียรภาพ ลดความไม่แน่นอนทางการเมืองของไทย และสร้างความต่อเนื่องของนโยบายในการบริหารราชการแผ่นดิน

SCB EIC

"We expect that the direction of the policy package will become much clearer after the policy announcement to Parliament."

ทั้งนี้คาดหวังว่าทิศทางชุดนโยบายจะมีความชัดเจนขึ้นมากหลังการแถลงนโยบายต่อรัฐสภา

SCB EIC

"Fitch (February 11, 2026) has emphasized the importance of political and fiscal stability as key to maintaining the country's creditworthiness."

Fitch (11 ก.พ. 2026) ได้เน้นย้ำความสำคัญของเสถียรภาพทางการเมืองและเสถียรภาพการคลังเป็นหัวใจสำคัญในการคงสถานะความน่าเชื่อถือของประเทศ

Key Entities

Organization

SCB Economic Intelligence Center(SCB EIC)

An economic think tank that analyzed the economic implications and political timeline of the Thai government formation.

Bhumjaithai Party(พรรคภูมิใจไทย)

A political party that emerged as a significant winner in the election and aims to lead the formation of a coalition government.

Election Commission(คณะกรรมการการเลือกตั้ง)

The body responsible for overseeing elections in Thailand, which provided unofficial results.

People's Party(พรรคประชาชน)

The political party designated to form the opposition following the election results.

Moody's(Moody’s)ℹ️

A credit rating agency that adjusted Thailand's credit rating outlook to negative.

Fitchℹ️

A credit rating agency that adjusted Thailand's credit rating outlook to negative, later emphasizing the importance of political and fiscal stability.

Former Move Forward Party(พรรคก้าวไกลเดิม)

Referred to as the former party in connection with potential political cases impacting the political landscape.

Policy

10 Plus(10 พลัส)

Bhumjaithai Party's policy package aimed at economic recovery and development.

Khon La Khreung Plus(คนละครึ่งพลัส)

A subsidy program mentioned as part of the '10 Plus' policy, focusing on short-term benefits.

Landbridge(แลนด์บริดจ์)

A policy that was announced in election campaigns but not explicitly detailed in the '10 Plus' package initially submitted.

Community Plus(ชุมชนพลัส)

A broad policy area within Bhumjaithai Party's '10 Plus' that lacks specific operational details.

Investment Plus(ลงทุนพลัส)

A policy under Bhumjaithai Party's '10 Plus' aiming to increase investment as a percentage of GDP.

Trade Plus(Trade พลัส)

A policy under Bhumjaithai Party's '10 Plus' focused on upgrading production and global market competition.

Thailand Plus(ไทยแลนด์พลัส)

A policy under Bhumjaithai Party's '10 Plus' focused on rapid government approval processes.

Law

Budget Act(พ.ร.บ. งบประมาณ)

The legislative act that authorizes government spending, the announcement of which is anticipated to be delayed.