Business upbeat on Bt900-billion rehabilitation spending plan
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The public sector yesterday hailed the government's plan to spend nearly Bt1 trillion to rehabilitate the country and develop an effective water-management system, but questioned whether there was any concrete plan to prevent or even dilute another disas
“What we want is the government’s announcement that floods on this scale will not reoccur. Only this will restore foreigners’ confidence and keep their investments in Thailand,” said Pornsilp Patcharintanakul, vice chairman of the Thai Chamber of Commerce.
The Bt900 billion budget is big enough for short- and long-term improvement of the water management system, but it remains unclear how the government would spend the amount, he said.
The government should first implement its policies announced earlier to relieve the impacts in the short term, including soft loans, import duty reductions, help in bringing in foreign technicians and financial assistance for SMEs.
‘More dams should be built’
In the long term, with over half of the budget, more dams should be built, forests should be better protected, depleted areas should be reforested and farmland preserved, he added.
Prime Minister Yingluck Shinawatra said the government will spend Bt80 billion to revive industries within three months and banks will lend Bt300 billion. The rest would be allocated for long-term solutions.
Chakkrit Parapuntakun, director-general of the Public Debt Management Office, said that although he has not seen the details of the plan, the government should not have difficulty in raising funds given that public debt is only at 41 per cent of gross domestic product. However, the investment plan should be clear.
With an emergency decree, the government could get the funds within 45 days, he said.
Former finance minister Korn Chatikavanit said the Pheu Thai-led government is going to do what Pheu Thai MPs objected to when the Democrat-led government issued an emergency decree to borrow Bt400 billion for economic stimulus after the 2008 global financial meltdown.
Issara Boonyoung, president of the Housing Business Association, said the floods underlined the need for better water management at the national level. Provincial capacity should be enhanced while greater cooperation with the Bangkok Metropolitan Administration is a must.
Water management ‘poor’
It is high time to acknowledge that the country’s water management capability is poor, with conflicting information coming from the BMA, Irrigation Department and Town and Country Planning Department.
"Each year, the government spends tens of billions of baht on flood management while Thailand also suffers droughts. It’s time for us to have a national agenda to improve the system. It’s not time to say who’s right or wrong, but it’s time for everyone to learn from the
crisis," he said.
Teerana Bhongmakapat, dean of economics at Chulalongkorn University, wondered if the government was selling another dream to the public.
“I don’t think the government knows what they should do next. The government just throws out an idea in a bid to win back confidence after bungling management of the flood situation,” he said.
People have lost confidence in the government due to its inefficiency in flood management, he said.
The government has to urgently plan ahead for a pandemic disease outbreak, since the floods affected over 2 million people. Most families are living in poor conditions due to the feeble warning system. They face greater difficulties than manufacturers, which can relocate their production lines and receive compensation payouts from insurance companies.
“Manufacturers at the worst suffer an opportunity loss, but household losses are monumental. The bankruptcy of several million households could lead to an economic crisis. I don’t think the government is prepared for this,” he warned.
Somchai Sujjapongse, director-general of the Fiscal Policy Office, said the flood damage so far is estimated at Bt180 billion and could cut economic growth by 1.8 percentage point. This year’s growth would then be 2.7 per cent, while inflation would be fuelled by the flood.
To finance the investment plan, the Finance Ministry would borrow from domestic and overseas markets. The government could issue an emergency decree for the first Bt100 billion, he added.
