Thai economy faces risk due to long-lasting public projects

15:33 | 17/05/2018 Global Economy

Slow disbursement of public investment has left Thailand plodding behind faster-growing Southeast Asian economies, according to a study by University of the Thai Chamber of Commerce.

Slow disbursement of public investment has left Thailand plodding behind faster-growing Southeast Asian economies - Photo: The Straits Times

The situation was attributed to difficulties in spending facing state agencies because of Government regulations.

Disbursements for public projects fell by 5 percent in each of the two latest quarters, as bureaucrats observed stricter procurement rules introduced in the second half of 2017 to clamp down on graft.

The Finance Ministry has banked on stronger export growth to keep its 2018 economic growth forecast at 4.2 percent, though analysts reckoned the fall in public investment spending could be worse than the ministry anticipates.

Public projects are facing delays over issues arising from bidding and feasibility studies partly as a result of that caution.

At least 20 transport infrastructure projects worth over 730 billion THB (US$22.7 billion) are under construction and 15 others are ready or at the bidding stage. That compares with about eight projects under construction in early 2017.

Thailand also plans to open bidding for transport projects worth a further 640 billion THB this year, including a 225 billion THB high-speed rail project to link three main international airports, according to Transport Minister Arkhom Termpittayapaisith.

Theo VNA