Thailand’s government plans to increase spending on investment to the highest in seven years in an attempt to spur local demand and offset weakening exports.

The budget for the fiscal year starting Oct. 1 will have a deficit of 390 billion baht ($11.7 billion), which is 56 percent higher than the current year. Investment will account for a fifth of total spending, Prime Minister Prayuth Chan-Ocha said Thursday in parliament.

“Higher investment spending is mainly for construction works like roads and rails, which will definitely help boost the economy,” Arkhom Termpittayapaisith, secretary general of the National Economic and Social Development Board, said after the release of GDP data on May 18. “We decided to set such a high budget deficit so we can increase investment, which is much needed for Thailand.” According to the draft of the budget, which was presented in parliament Thursday for discussion, total spending will rise 5.6 percent from a year earlier to 2.72 trillion baht, with revenue of 2.33 trillion baht. The budget assumes real GDP growth of 3.7 percent to 4.7 percent with inflation at 1.1 percent to 2.1 percent next year. Credit and view full story at Bloomberg