Assessing the Impacts of COVID-19 and Fiscal Measures on Thailand’s Economy: A Social Accounting Matrix Approach

Abstract

          This research aims to assess the impact of COVID-19 on the Thai economy in 2020 and fiscal measures used to aid and relieve people exposed to COVID-19 and promote economic recovery with a use of a Social Accounting Matrix (SAM) for Thailand. The paper gathers data from multiple sources (an input-output table, a national income, a household socio-economic survey, and tax statistics) and constructs a 2015 Social Accounting Matrix for Thailand with updated information to reflect an overview of the Thai economy in 2020 and to analyze and evaluate economic impact resulting from the COVID-19 pandemic and government’s fiscal measures. The study found that, in 2020, an average output multiplier in all production sectors was 3.526; a value-added multiplier was 1.523; and an income Multiplier was 1.387.  In 2020, revenues of export and tourism decreased 8.21% and 70.95% (YoY) from the COVID-19 outbreak which directly and indirectly resulted in a 6.23% and 25.22% decline in total domestic product, respectively.
         The fiscal measures to support economic recovery and resilience  from COVID-19, such as the State Welfare Card Scheme, had a crucial role for the short-term economic recovery. It is expected that the scheme’s THB 509,740 budget from October 2020 to December 2021 will create the value-added up to THB 902,212 in the short term because of multiplier effects. Nevertheless, the degree of economic impact and economic recovery not only depend on the stimulus measures from the government, but also on duration of lockdowns, level of international economic dependence and global supply chain connectivity, and economic infrastructure and economic vulnerability, including public debt and structural problems. Besides the fiscal stimulus measures, the government should take these factors into account as well.