Thai govt sets June deadline for water, road repair contracts

[webfact]

BUDGET SPENDING
Govt sets June deadline for water, road repair contracts
The Nation

BANGKOK: -- The government has set a June deadline for applications for Bt78 billion in procurement contracts for water-system and road-repair projects.

Meanwhile, the Public Debt Management Office will invite financial institutions to join the first Bt10-billion round of bidding on loans for the projects this week.

Theerat Attanavanij, deputy director-general of the PDMO, said Bt38 billion worth of water-management projects and Bt40 billion worth for road-system development would be financed by borrowings. These urgent-phase projects are expected to have investment contracts in place by the end of June.

Previously, the government gave the Finance Ministry a green light for external borrowings of no more than Bt80 billion for the urgent phases of these projects. However, the ministry now plans to borrow from domestic financial institutions.

Of total borrowings, about Bt10 billion will be used to finance investment projects that do not require procurements in the third quarter of the current fiscal year (April-June 2015).

"This week, we will send letters to advise financial institutions of our tendering plan for such borrowings. This will be in the form of gradual disbursement, subject to demand for money. When total disbursement is made, the debt will be converted to long-term bonds," Theerat said.

A total of Bt33 billion is expected to be disbursed for the projects in 2015, Bt40 billion in 2016 and Bt5.6 billion in 2017.

At the end of February, Thailand's outstanding public debt totalled Bt5.72 trillion, up Bt62.3 billion from January. February's figure accounted for 46.83 per cent of gross domestic product.

If GDP expands by 3.5 per cent this year, the public debt will not exceed 50 per cent, Theerat said. The PDMO expects the public debt to be 48.9 per cent of GDP by the end of this year.

If GDP rises or falls Bt100 billion, that will move the public-debt ratio by 1 percentage point.

"Now, there's no concern about our public-debt level, as credit-rating companies take the view that as long as the public debt has quality - that is, it is used for investment - there would be no problem for credit assessment," Theerat said.

Source: http://www.nationmultimedia.com/business/Govt-sets-June-deadline-for-water-road-repair-cont-30258350.html


-- The Nation 2015-04-21

[BSJ]

Some roads are past bad!

[aussiesteve63]

I've been waiting 5 years for my gravel track to be paved as promised by the village head when we built our house,he stopped coming to our place about 3 years ago looking for donations for this and that when I told him no more donations till the roads fixed.the people in our soi put in 2000 baht a year to get the road repaired after the wet season

[gk10002000]

Yeah well, get the contracts issued and money flowing while the junta is in power (without any independent cost or capability review). I suspect there is not a lot of open bidding and competition and civilian oversight? Sad

[Srikcir]

"the government gave the Finance Ministry a green light for external borrowings of no more than Bt80 billion for the urgent phases of these projects."

Finally, the Junta-led government is going to provide badly needed economic stimulus for the nation through infrastructure improvements by borrowing the funds (ie., issuance of treasury bonds). Prayut had been personally against creating any debt for the nation. The business sector has been virtually screaming for the government to follow through for the last 6 months as the GDP falters.

HOWEVER,

Only Bt10 billion will be used to finance investment projects that do not require procurements in the third quarter of the current fiscal year (April-June 2015). That is too little and too late to sustain a GDP growth rate higher than 3% for the year. Now the Junta is betting on making bigger and more timely economic decisions for 2016 but that might be disrupted by a constitution referendum and/or national elections. The nation's economic woes will not be reversed in 2016.