• 
• 

Published on July 30, 2007

The Asian Development Bank has offered the Finance Ministry a long-term loan of up to 30 years to finance infrastructure projects.

"The ADB wants to offer loans and technical assistance to the Thai government, Deputy Finance Minister Sommai Phasee said after meeting ADB executives on Friday.

Sommai said Thailand had not borrowed from the bank for a long time. This had probably resulted in the government decreasing its role in rural development and worsening the income gap between the rich and poor, he said.

His comments imply that the government may consider borrowing from the ADB to finance mass-transit or other mega-investment projects, while the Japan Bank for International Cooperation (JBIC) apparently does not want to lend to the government.

Sommai, however, insisted Japan was still committed to lending for mass-transit projects.

"I met the Japanese ambassador a few days ago and he told me that the Japanese government is committed to providing loans," Sommai told reporters.

Meanwhile, Jean-Pierre Verbiest, director at the Thailand resident mission of the ADB, said the bank was ready to lend to the government if it needs funds for investment and development.

Asked about the possibility that the administration may not want to borrow from the ADB because it could seek loans from other sources at a lower cost, he said the bank's loan package was competitive because it offers both technical assistance and loans of up to 30 years.

Over years, the ADB has offered several grants and technical assistance to the government, he said.

In other developments, officials at Finance Ministry said the Government Housing Bank (GHB) still wanted the Secondary Mortgage Corp to act as a special-purpose vehicle for the issue of securitised bonds. The GHB plans to raise funds worth Bt40 billion through the issue of bonds backed by housing loans.

Officials also said the State Enterprise Policy Committee would propose that the government set up a new private company to run a logistics business, instead of revitalising the now-defunct Express Transportation Organisation of Thailand.

The proposal is based on the past failure of the logistics business under the supervision of the Transport Ministry.

The Cabinet earlier asked the Finance Ministry to study whether the state enterprise's logistics operation could function again.

Wichit Chaitrong

The Nation