BANGKOK (REUTERS) - Thailand's military government has approved economic measures worth a combined 136 billion baht (S$5.377 billion) aimed at boosting spending power in rural areas, as the junta struggles to lift economic growth.

The measures include soft loans via village funds worth 60 billion baht and a budget of 36 billion baht for sub-districts, Deputy Finance Minister Wisut Srisuphan told reporters after a cabinet meeting.

The government will also speed up spending on small projects with 40 billion baht, he added.

Southeast Asia's second-largest economy has yet to regain traction after the army seized power in May 2014 to end months of political unrest, with exports and domestic demand stubbornly sluggish.

Low commodity prices have cut farmers' earnings while record-high household debt has curbed consumption.

The national planning agency last month cut its 2015 economic growth forecast again to 2.7-3.2 per cent from 3.0-4.0 per cent. Many economists believe the revised target is still too optimistic. Growth in 2014 was only 0.9 per cent, the weakest since flood-hit 2011.

The economy grew 0.4 per cent in April-June from the previous quarter, with tourism the key driver.

A bomb in Bangkok two weeks ago, which killed 20 people, has dealt a further blow to the economy.