Bt2-tn financing will be done responsibly, Kittiratt tells IMF, World Bank
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Borrowing to finance the government's planned Bt2-trillion transport-infrastructure projects will be prudent, Finance Minister Kittiratt Na-Ranong told a meeting of major financial institutions.
He was responding to criticism that a lack of transparency in investment projects and the rice-pledging scheme could undermine the country’s fiscal stance.
Kittiratt, who is also a deputy prime minister, clarified the need for and potential benefits of the Bt2-trillion transport-development and Bt350-billion water-management projects at the annual meeting of the World Bank and the International Monetary Fund held from Thursday to Saturday last week, the Finance Ministry said.
Borrowing from overseas will be small, and financing through long-term bond issuance will be done with prudence, Kittiratt reportedly told the meeting.
Financial institutions that could be tapped include CitiBank, Mizuho Financial Group, Bank of Tokyo Mitsubishi UFJ, JBIC, Credit Suisse, Barclays, Standard Chartered Bank and HSBC. Kittiratt said such financial institutions had experience in fund mobilisation through US-dollar-denominated bonds in overseas capital markets.
Local and overseas analysts have expressed concerns that Thailand’s Bt2-trillion borrowing plan and rice-pledging scheme could harm the country’s fiscal position.
Kittiratt noted that despite Thailand’s current economic slowdown, inflation remained manageable. The country had a low unemployment rate, high foreign reserves, public debt below 45 per cent of gross domestic product and a strong fiscal stance, he said.
Amid the slowing global economy, Kittiratt said, Thailand’s economy remained strong, thanks to the government’s policy to adjust the economic balance to depend less on exports and more on domestic demand, including private investment and consumption.
