[KatoeyLover69]

Report from Bangkok Post dated Saturday 25 February 2006 :-

Megaprojects first casualty of snap vote : Pongsak resigned to postponements

The government's vaunted megaproject programme worth 1.8 trillion baht is the first casualty of yesterday's move by Prime Minister Thaksin Shinawatra to call a snap election. Rising political uncertainty had already raised doubts about whether any of the high-profile infrastructure projects, seen as a major tonic for the economy, would get off the ground this year.

Speaking yesterday before Mr Thaksin announced the dissolution of Parliament, Transport Minister Pongsak Raktapongpaisal said he was seeking a one-month postponement of the April 28 date originally set for accepting the first proposals from investors.

Mr Pongsak did not mention politics, saying only that foreign investors had expressed concerns over ''various issues''.

Mr Thaksin late last month briefed 1,300 foreign investors at Government House about the government-supported megaprojects. They cover mass rail transit systems, water management, information networks, defence modernisation, agriculture, science and technology, culture and public health under the so-called Thailand Modernisation framework.

The government set April 28 as the deadline for interested parties to submit technical proposals. One to two months later, they were to be invited to offer financial proposals.

Screening was to be completed by September with the first projects to be started by the end of this year.

Mr Pongsak quoted investors from Spain as saying they would be unable to meet the existing deadlines as their Thailand offices had yet to be established.

He said Spanish investors taking part in a major trade mission to Thailand earlier this week had shown strong interests in mass transit and ports.

Finance Minister Thanong Bidaya said the government might speed up projects that need local expertise and capital, such as low-cost housing and those related to the culture and public health, if work on mass transit systems was put off.

Chumpol Patanukom of Alstom, French engineering conglomerate, said a one-month postponement was unlikely to affect the mass transit projects for which his company intended to compete.

''A delay at least gives us more time to make the best of our proposal, despite the fact that we are confident we could finish our proposal at the April 28 deadline,'' said Mr Chumpol.

French President Jacques Chirac, who visited Thailand a week earlier, made clear France's wish to secure the new Bangkok mass transit project as a ''flagship of co-operation'' between the two countries.

A source from Siemens, the German transport and engineering conglomerate, said a delay would allow more time for proposal preparation, as the time conditions were relatively limited.

A Bank of Thailand official said delays in the megaproject programme would only have a slight impact on economic growth.

The central bank currently projects economic growth of between 4.5% and 5.5% this year, with an assumption that 130 billion baht in megaproject investments, or 53% of the 255 billion set aside for fiscal 2006, would be injected into the economy in this calendar year.

The official said foreign investment in megaprojects could start in the near future, if the government continued under its existing bidding framework.

''The proposals by international bidders to date have quite a clear plan on funding sources and construction [models],'' said the official, who asked not to be named.

''Under the old deadline, investors were expected to start the megaprojects in the last quarter of the fiscal year from July to September. But if [the bidding deadlines] are stretched out, investment is likely to begin in the first quarter of fiscal 2007, which would still benefit the economy this calendar year.''