Fuel Fund must repay loan in seven years: finance minister
A loan to the state oil fund is considered as public debt which the Office of the Fuel Fund must repay within seven years, Finance Minister Arkhom Termpittayapaisith made it clear on Wednesday.
His statement came after the Cabinet on Tuesday approved an executive decree that would enable the Finance Ministry to guarantee a loan of 150 billion baht to the Fuel Fund.
Arkhom revealed that the fund’s balance sheet was largely “negative” and it was risky to borrow any money from banks, so the Finance Ministry had to step in to guarantee the loan.
The minister said he would look into how the Office of the Fuel Fund reduces expenses and manages revenue.
The fund does not have to use the entire 150 billion baht as the decree allows, he added.
Arkhom reiterated that the money the fund borrows will be considered public debt even if the ministry did not guarantee the loan, as the Cabinet had already approved a 30-billion-baht loan.
It will affect public debt during a certain period but the ministry has set a condition for the Office of the Fuel Fund to repay the loan in seven years, Arkom said.
He told the Energy Ministry that borrowing should be a last resort because there were costs and interest associated with loans.
However, the borrowing will not affect the government’s budget because the Office of the Fuel Fund has the responsibility to manage and repay the loan, Arkhom added.
