PPP panel OKs joint projects

A Purple Line train stops at Tao Poon Station. The PPP committee has approved the new Purple Line route between Kanchanaphisek Outer Ring Road and Tao Poon under a budget of 128 billion baht. PORNPROM SATRABHAYA

The Public-Private Partnership (PPP) Committee has approved a five-year strategic plan for joint investment projects worth 1.62 trillion baht, a move to accelerate infrastructure investment amid budget constraints and sharpen the country’s competitive edge.

Under the five-year strategic plan through 2021, 94% of the 1.62-trillion-baht budget will involve transport infrastructure and overall logistic costs will be cut by 2-3 percentage points from 13-14% of GDP once the projects are completed, said Ekniti Nitithanprapas, director-general of the State Enterprise Policy Office.

The transport projects under the five-year PPP strategic plan will be divided into two groups: projects for which the government wants the private sector to play a role in, such as high-speed trains, rail systems in Bangkok and ports for shipping goods, and projects in which the government encourages the private sector to invest, such as airport and motorways.

Mr Ekniti said 600 billion baht worth of projects under the fast-track PPP scheme will be a part of the 1.62-trillion-baht strategic PPP plan.

The PPP panel has already approved projects under the fast-track PPP scheme worth 900 billion baht. Those projects include several electric trains: the Purple Line between Kanchanaphisek Outer Ring Road and Tao Poon (128 billion baht) and the Orange Line’s eastern and western sections (221 billion baht), as well a route connecting Phuket airport and Chalong Circle (31 billion baht) and another project in Chiang Mai.

Mr Ekniti pointed to differences between the Private Investment in State Undertakings Act of 2013 and the amended draft bill, with the latter to focus on basic and public infrastructure projects while any projects that use state land will be classified as PPP projects under the current law.

The bill will eliminate red tape and bottlenecks to encourage the private sector to jointly invest in infrastructure projects, while anti-corruption remains a focus, he said.

Mr Ekniti recently said that risk- and return-sharing provisions will be included in an amended draft to ease investor concerns over joint investments under the PPP scheme.

Under the Private Investment in State Undertakings Act, either the private or the public sector must take on all risk associated with PPP projects, as the act does not state risk- and return-sharing principles.

With state budget constraints, accelerating joint investment under PPP projects is crucial to achieve the 12th Economic and Social Development Plan, which requires PPP worth 47 billion baht each year.

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