US-Iran War Claims Victim: Thailand to Borrow Rp195 Trillion

Neighbouring country to Indonesia, Thailand, is now in dire straits due to the war between the United States (US) and Iran. The nation has finally approved an emergency loan package amounting to US$12.2 billion (Rp195.2 trillion) on Tuesday (5/5/2026) to alleviate the economic impacts from the conflict in the Middle East.

The cabinet stated that the funds will be used to increase domestic spending and ease economic hardships caused by rising inflation and slowing growth. Previously, the government revised its growth projection to 1.6% from 2.4% last year.

The loan, approximately 400 billion baht, will be disbursed from June to September. It includes assistance for more than 20 million low-income individuals under the government’s “Thai People Helping Each Other” scheme to alleviate living costs.

“The funds will also be used to support alternative energy,” said Finance Minister Ekniti Nitithanprapas in a press conference following the cabinet meeting.

The same was affirmed by Prime Minister Anutin Charnvirakul. He described the loan as a “tool to advance the country and prevent economic weakening”.

“We will get through this crisis together,” he told reporters.

The loan represents the largest in the Land of the White Elephant in several decades. The amount is among the highest in recent history, but below levels seen during the 1997 Asian financial crisis and the Covid-19 pandemic years.

Public debt reached 66.38% of GDP in March, below the 70% limit, and the new loan will not exceed that threshold, according to the finance minister. Thailand’s core inflation is projected to reach 3.0% this year, up from the previous estimate of 0.3%.