Thai port project may be privatized

Thai port project may be privatized

BANGKOK (DPA): Thailand's cabinet will decide the fate of
Bangkok's second international airport next Tuesday with a
proposal to privatize portions of the airport project in the
cards, a government spokesman said yesterday.

"We are studying the privatization of portions of the project,
such as the airport terminal," said Poosana Oremanoch, deputy
secretary-general to Prime Minister Chavalit Yongchaiyudh.

He said a revised study of the feasibility of the Second
Bangkok International Airport project would be proposed to
cabinet on Feb. 11.

Chavalit shocked the local and foreign business community last
month when he proposed to shelve the Nong Ngu Hao airport project
due to delays and construction overruns at the site, which was
first approved in 1991 as the most appropriate place for a second
international airport for the capital.

Alternatively, Chavalit proposed expanding existing facilities
at Don Muang international airport across the runway into an area
now occupied by the Royal Thai Airforce.

Poosana claimed that the government had come to an agreement
with the airforce about transforming parts of their former base
for commercial aviation use, a plan that would cost five billion
baht (US$200 million) plus an unspecified amount to relocate
airforce facilities, and take three years to complete.

If approved Bangkok's Don Muang airport would be able to
handle 37 million passengers per annum by the year 2000, enough
to cope with growth forecasts until the year 2002.

Poosnana, a close aide to the prime minister, said
construction on the Nong Ngu Hao airport would definitely
continue, but parts of the project might be farmed out to the
private sector.

"The terminal alone will cost an estimated 36 billion baht to
build; we could privatize 50 per cent of it by allowing a private
company to built and operate," said Poosana, in an interview with
a dozen foreign correspondents at Government House.

"The name of the game is to reduce the budget expenditure," he
added. Thailand's government, faced with an expected revenue
shortfall this year, has promised to trim about 100 billion baht
($4 billion) from this year's public expenditures.

Opposition parties Thursday launched an "urgent motion"
against the government's bungling of the second airport project,
which has shaken international confidence in Thailand's ability
to commit itself to long-term infrastructure projects receiving
international funding. The Japanese government is a major
creditor to the Nong Ngu Hao airport scheme.

Some have also questioned the wisdom of taking on two projects
- the expansion of Don Muang and the continuation of Nong Ngu Hao
- when the government has supposedly announced a tight fiscal
policy.

"The government has to find two big sources of funds to
finance the two projects at the expense of the country's
increasing financial problems," said Chuan Leekpai, leader of the
Democrat Party and the opposition.

The Nong Ngu Hao (literally Cobra Swamp) international
airport, located on the eastern edge of Bangkok, is expected to
cost 100 billion baht and would be completed by the year 2002.
With the Don Muang airport expansion Bangkok's total capacity
would exceed a whopping 60 million passengers per annum, double
the current arrival figures.