If amount cut to Bt400 bn, money will not have to be sought outside: Korn
Former finance minister Korn Chatikavanij advised the government to reduce its plan to borrow Bt2 trillion to Bt400 billion so it would not need funds from sources outside the state financial system.
Korn, who is also deputy leader of the opposition Democrat Party, said the focus should initially be on projects that have undergone feasibility studies and are ready for public hearings and environmental-impact assessments. These projects would only require about Bt400 billion, he said, citing information from state agencies reporting to the House of Representatives’ vetting committee on the bill.
He was speaking at yesterday’s House debate on a bill empowering the Finance Ministry to borrow Bt2 trillion for the government’s transport infrastructure projects.
“My question to the committee chairman is whether the government will be able to go ahead with the projects outlined in the bill if there were no borrowing law. If you can’t answer this question, then I would like to exercise my right as a minority committee member to answer on your behalf. I have a clear plan that allows all the projects to go ahead without this law,” Korn said.
He added that the remaining Bt1.6 trillion required for the projects could be obtained through normal financial channels for the next seven fiscal years, in accordance with a project plan disclosed by Transport Minister Chadchart Sittipunt.
“The government will have no need to borrow outside the fiscal system for the projects then,” Korn added.
Finance Minister Kittiratt Na-Ranong, however, cited the need for continuity of the projects, saying the government did not wish to evade scrutiny as alleged by opposition MPs. He added that previous governments had also issued similar laws that allowed spending outside the fiscal system.
Kittiratt, who is also a deputy prime minister, said many projects approved by the government were awaiting funds so the construction could go ahead. In response to the opposition’s concern that the projects could be marred by irregularities, he called on opposition politicians to help scrutinise those projects to prevent graft.
Bank of Thailand Governor Prasarn Trairatvorakul, meanwhile, said market liquidity should be sufficient to cover the seven-year investment of the Bt2-trillion infrastructure projects at about Bt300 billion a year.
Prime Minister Yingluck Shinawatra said the government was aiming to “invest for the future” with the help of this borrowing law. She said representatives from the Thai Bankers Association who met with her on Wednesday night also wanted to see more investments in infrastructure, as these investments would boost the country’s revenue.
The PM compared the Bt2-trillion borrowing plan to a bank loan required to refurbish a house.
“We need to renovate the entire house, including its structure. The structure must be able to support the extension.”
She added that the government was trying to limit its public debt to no more than 50 per cent of gross domestic product.
Yingluck has called a meeting of relevant state agencies today to discuss a planned “roadshow” for the Bt2-trillion transport infrastructure projects, Government Spokesman Teerat Ratanasevi said. The roadshow is scheduled to begin at Government House next Thursday, before it heads to the provinces early next month.
Interior Minister Charupong Ruangsuwan said yesterday that Bt2 trillion in loans was needed to improve Thailand’s competitiveness ahead of the Asean Economic Community, which kicks off in 2015.