Nine easy measures to get rich

Chang Noi, The Nation, Asia News Network, Bangkok

A decade ago, many people got worried about corruption in big government projects, particularly those involving construction. The Anand Panyarachun governments (1991-1992) created a lot of new rules to control it -- stricter bidding procedures, anti- collusion laws, environmental and social impact studies and so on.

But rest assured, if you have the right political contacts, some seed capital and a burning desire to make lots and lots of money, it's still possible. Here is a simple, step-by-step user's guide.

Install your man in the key decision-making role in the relevant ministry. Usually the best post is the department head. With luck, the position is available at a price payable to the minister overseeing the appointment. You can raise the money by clubbing together with like-minded colleagues who have interests in other big projects. In some sophisticated ministries the payment can be made as a deposit up front followed by installments depending on the success in generating returns.

Create or activate some suitably grandiose project. Make sure it is planned on a turnkey basis. This is critical, because it allows much more flexibility at the later stages.

Find a friend with a consultancy company. Or just set one up with your friends. You might want to have a share in the company in order to exert some control, but you should keep this hidden. Companies based overseas or at least headed by foreigners look very good in this role and are often good performers. One such consultancy company once offered to make Chang Noi "very rich" for just endorsing a report. Expertise is not a problem. There is a good supply of underpaid academics, both here and overseas. Ensure this company is engaged to write the specifications for the project.

At the bidding stage, make sure all serious competitors are somehow removed. There used to be a very good system for doing this, known as hua, which shared major projects around a select syndicate of contractors. But then the government passed an anti- collusion law. Luckily the law was written in such a way that the procedures laid down are far too complex. It's simply unworkable and hence is usually ignored. Some people think this was a very clever piece of law-drafting.

Set up a state enterprise to oversee the project. By doing this, you can avoid many of the strict rules which government departments have to follow when they manage such projects.

Forget to do the environmental-impact study or social-impact study, even if it is technically required by the rules. By the time NGOs find out about the project and people affected by it start to protest, you should have the foundations finished. It will be too late.

Once the contractor is chosen, revise the project and increase the budget. This is the beauty of the turnkey format. You can present the revisions as technically superior or of greater public benefit or whatever. You can even change the location if a friend has a piece of land on which he would like to make a nice profit. These changes have to go through the Cabinet, but usually this does not seem to be a problem.

Set up other companies to act as subcontractors. They can do things like buying the land for the project or supplying materials. Luckily the rules on conflict of interest are so poor that you can subcontract to a company in which many of those directly involved -- ministers, officials -- have a share. These days, however, journalists and NGOs are sometimes too inquisitive. Unless you are a really "big" name, it's probably best not to have your name on the company registration. Instead, you can hold hun lom, "wind shares", which are as invisible as the wind. This is one of those techniques which, like putting shares in the name of your cook and gardener, seems to be all right because "everybody does it".

Once you have the system set up, you must keep using it. Your first effort may have resulted in a project which is obviously overpriced, perhaps even useless, and very destructive of natural resources and local communities. But don't get too upset. Thailand is full of underused waste-water and rubbish-incinerator schemes, oddly wide stretches of road and dams which don't seem to work. For future projects, you can even increase the profit by reusing an old project design in a new location, even if it was a bit of a disaster first time round.

You might think this guide is too ambitious, that controls could not be so lax and the money-making opportunities could not be so big and easy. Not so.

A team from Chulalongkorn University is just completing a study of contract and procurement practices in some recent big projects like the Klong Dan waste-water facility, Suvarnabhumi Airport at Nong Ngu Hao, and the Bang Pakong dam. The study shows that all of this is common practice.

It reckons you should be able to get away with 10 to 20 percent of the budget. Add in the normal business profit, and that could rise to 30 or 40 percent.

The Chula study also shows that the procedures for designing, allocating and monitoring projects in Thailand are much looser than in countries like Hong Kong, Germany and Denmark. Loopholes everywhere.

These other countries have systems to screen questionable contractors out of the bidding process. They have bidding procedures which are workable and transparent. They have an expert agency to oversee the bidding process. They have conflict- of-interest rules which prevent officials and politicians having an interest in a company which acts as a contractor or subcontractor.

There are rumors that the WTO will force Thailand to tighten things up. Maybe. In the meantime, happy contracting!