Thais 'spending beyond their means'

Bangkok (The Nation/ANN) - Non-performing personal loans in Thailand have soared to more than 56.5 billion baht (US$1.8 billion) in the third quarter of this year, the National Economic and Social Development Board (NESDB) said recently.

This amount accounts for 21.4 per cent of the outstanding non-performing loans of all financial institutions.

"A number of people have been spending beyond their means," NESDB deputy secretary-general Suwannee Khamman said yesterday, adding that one of the factors behind this overspending was the government's policy to offer tax rebates to first-time car buyers.

According to her, the number of personal loans taken to purchase vehicles has jumped by 33.6 per cent between July and September when compared to the same period last year, while the number of loans taken for new homes has soared by 10.3 per cent. Loans taken for other types of products/services have also risen by 30.3 per cent.

"We have to closely watch the spending behaviour of low- and middle-income earners," Suwannee said, adding that even though the significant hike in the daily minimum wage had not hurt the rate of employment, many employers were cutting down on the number of paid working hours.

According to NESDB, more than 6.1 million people now work less than 35 hours a week and many in this group are unskilled labourers who want to work more hours for better pay.

Suwannee said that while the minimum daily wage had soared significantly, in actual terms it had only increased by 10 per cent because the price of basic necessities had also risen.

She was speaking after the NESDB released a report on Thailand's social outlook in the third quarter of this year.

Also according to the Public Health Ministry, some 1.5 million Thai citizens aged 15 and above are suffering from depression. This has become a concern because it is a leading cause of suicides and is affecting the society and economy adversely. Overall, Thai people's gross happiness index has been dropping in the face of the rising cost of living, political conflicts and natural disasters.

Suwannee said research had found that most underage youth were able to purchase cigarettes easily, and about 80 per cent of young people surveyed said neighbourhood shops freely sold smokes to youngsters.

Another study has found that domestic violence exists in 36.6 per cent of families that have at least one member who drinks heavily.

"Statistics have also suggested that about a fourth of the arrested drug suspects are first-time offenders and most of the people arrested on drug-related charges are young people," she said.

Unpaid bills

- Overspending sees defaults rise in the third quarter.

- Households' overdue payments (more than three months late) jump by 37.8 per cent

- Overdue payments to credit-card companies (more than three months late) rise by 11.1 per cent

- Non-performing personal loans stood at 56.5 billion baht, which accounts for 21.4 per cent of outstanding non-performing loans of all financial institutions.

Source: National Economic and Social Development Board

*US$1=30.6 baht

COPYRIGHT: ASIA NEWS NETWORK

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