BANGKOK - THAILAND'S new cabinet agreed Tuesday to a US$3.28 billion (S$4.89 billion) stimulus package to counter the economic slowdown after six months of street protests and last year's crippling airport seizures.

Prime Minister Abhisit Vejjajiva was elected by parliament on Dec 15 after a court dissolved the former ruling party, and he has vowed to boost the economy, which is estimated to grow at just zero to two percent this year.

The government will start spending the 115 billion baht (S$4.89 billion) in March, Mr Abhisit said, with money allocated to rejuvenating tourism and helping poor Thais deal with global and local economic woes.

'Our measures are based upon the notion of recovering the economy as quickly and directly as possible - that is, adding money in people's pockets,' Mr Abhisit told reporters after his weekly cabinet meeting.

'According to studies, giving money directly to people is the most effective. It will lead to more spending that will further help industrial, agricultural and business sectors as well as business operators.'

The package - which will be an addition to the annual budget already agreed for this fiscal year - will be officially approved by cabinet next week after details are hammered out and then go on to parliament.

Measures include raising welfare payments, expanding free education, handing out agricultural loans, and continuing the previous government's package for the poor including free public transport and subsidised electricity.

A Bank of Thailand study earlier this month estimated that Thailand lost 290 billion baht during the week-long blockade of Bangkok's two main airports in late November and early December by a group trying to oust the government.

The royalist group had already been protesting since May, causing the Thai stock market to plummet, and gave up their siege only when a court dissolved the then-ruling party linked to ousted premier Thaksin Shinawatra.

The central bank said the shutdown of Suvarnabhumi and Don Mueang airports prevented 3.4 million tourists from visiting Thailand, crippling the vital tourism industry, which accounts for five percent of Thai GDP.

A cabinet statement said that the stimulus package would also be used to create new promotions to lure back tourists and develop holiday destinations. -- AFP