(Bloomberg) — Thai Prime Minister Paetongtarn Shinawatra has announced her new cabinet formation, retaining Pichai Chunhavajira as finance minister, a sign of policy continuity as she faces the task of strengthening Southeast Asia’s second-largest economy.
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Pichai, a former chairman of the Thai stock exchange, was appointed finance minister and most members of the previous cabinet led by ousted leader Srettha Thavisin were also retained, according to a list published in the Royal Gazette on Wednesday. The cabinet will be sworn in by the king within days and Paetongtarn is expected to make a policy statement soon.
Phumtham Wechayachai, a leading member of the Pheu Thai Party, which leads the multi-party ruling coalition, was appointed defence minister, while Pirapan Salirathavibhaga, the leader of the military-backed United Thai Nation party, was appointed energy minister.
Paetongtarn, the third member of the influential Shinawatra clan to become prime minister, took over from Srettha, who was ousted by the country’s Constitutional Court for ethical violations. She must preside over a $500 billion economy that has averaged less than 2% growth during nearly a decade of military-backed rule.
Pichai’s challenges include accelerating an economic recovery with a controversial $14 billion cash handout to nearly 70% of the population that Srettha had touted as a way to boost growth to 5%. He may have to overhaul the so-called digital wallet program, a move Paetongtarn had hinted at after he was elected leader.
Parliament is expected to approve a 3.75 trillion baht ($109 billion) budget this week for the fiscal year that begins in October, seeking to boost an economy struggling with near-record household debt, high living costs and a sluggish manufacturing sector struggling with cheap imports from China.
Paetongtarn, 38, is a relative newcomer to politics and will have to prove that her lack of governing experience is no handicap in holding together the fractious coalition while trying to attract foreign investment into high-tech industries and halt the exodus of foreign funds from the country’s stocks.
Pichai, who first took over as finance chief in April this year, has taken steps to tighten oversight of the stock and bond markets, as well as introducing tax breaks to encourage investment in so-called sustainable funds. He has also pledged to launch a sovereign wealth fund that guarantees a minimum annual return and capital protection for investors.
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