K-water warns of legal action against activists

“This agency has never suffered a loss since it was established 47 years ago,” K-water vice president Yune Byung-hoon said at a press conference.

The press conference was held a few days after local newspapers reported that the state-run South Korean water agency was facing a financial crisis, as its debt had increased to more than 700 per cent of revenue.

The issue was first raised by the Korean Federation for Environmental Movement, which had visited the location where K-water would be contracted to build a water-retention area in the North of the Kingdom.

According to a report by the federation, K-water’s debt last year was higher than its capital.

K-water managing director Monton Panupokin said that last year, the South Korean agency had net expenses of about Bt101 billion and a gross profit of around Bt109 billion, leaving a net profit of Bt8.1 billion.

As of December 31, the total assets of K-water were Bt658 billion and its capital stood at Bt295 billion. 

Its debt was Bt362 billion at year-end, resulting in a debt-to-capital ratio of 122.8 per cent, he said.

While acknowledging that K-water’s debt had risen over the past three years – from Bt209.5 billion in 2010 to Bt331 billion in 2011 and Bt362 billion last year – he said: “I still insist that our financial status is stable.”

K-water has won the bidding for two major Thai water projects worth Bt160 billion combined: for water-retention areas, and a flood-diversion channel on both sides of the Chao Phraya River. The two projects form part of the government’s Bt350-billion water- and flood-management programme.

On Thursday, the Central Administrative Court ordered the government to conduct public hearings, environmental impact assessments and environmental and health impact assessments, as appropriate, before signing contracts with the companies winning the bidding for all projects under the programme. 

Yune said he would await the project contracts before making any decision on whether to go ahead with K-water’s planned participation.

However, he said his agency had already filed a lawsuit in South Korea against the Korean Federation for Environmental Movement over the allegations that the agency’s construction work had caused problems for natural resources in Korea and that it was facing a financial crisis. 

K-water is now also considering whether to file a suit against a Thai environmental network, he added.

“We have always complied with the law, including the Financial Act, River Act and Environmental Impact Assessment Act [in South Korea], to run water development projects, especially the rehabilitation of the four rivers project, which has been successful during the past few years,” said the vice president.

K-water won a case in the Korean courts after environmental activists alleged it had contravened the law, he said, adding, “We always listen to different opinions from experts and members of the public.”

Yune also responded to a report spreading via social media that Thaksin Shinawatra had visited K-water, saying that the former Thai PM had merely wanted to learn from Korea’s experience in water management. 

“He has no influence on our decision to join this water mega-project, which is the most difficult bid that I have ever experienced,” he said.

South Korea’s ambassador to Thailand, Jeon Jae-man, who also attended the press conference, expressed his concern over the allegation made by the civic group, saying the claim was not true.

He said he was also worried that K-water would face a loss if it participated in the Thai water projects, as the budget was too small and the construction period was too short.

“This would affect K-water’s creditability in the future,” he added.