The bustling metropolis of Bangkok has long served as Thailand’s economic locomotive, pulsating with productive energy. However, as this growth engine loses momentum, it opens the way for other rising cities like Chiang Mai, Khon Kaen, and Rayong to step in. Critical to their ascension will be massive investments in pioneering urban projects such as mass transit systems and renewable energy platforms, suggests the “Thailand Urban Infrastructure Finance Assessment” study. To back these ambitious endeavors though, cities cannot solely depend on contributions from the central government. The report advocates the exploration of other financial avenues such as municipal loans and public-private partnerships.
Urban expansion will bestow remarkable benefits to rural and urban inhabitants alike. The development of reliable transportation networks, the installation of comprehensive electrification systems and enhanced access to markets, school systems and health institutions are just a few highlighted perks. These advances will streamline the cross-city movement of people, goods, and services, facilitating economic growth, job creation and elevating living quality. Incorporating robust urban infrastructure is crucial in ensuring resilience against harsh climate patterns like excessive flooding and severe droughts.
Patricia Mongkhonvanit, Director-General of the Public Debt Management Office, Ministry of Finance postulates, “Secondary cities can be instrumental in driving growth and alleviating rural poverty by creating accessible opportunities for rural populations.” She affirms that findings from the study will be incorporated into plans initiated by the Ministry of Finance to boost urban growth in these cities. The overarching aim is to ensure that the needs of residents, businesses, and industries are adequately met.
The report proposes that authorized Thai secondary cities to independently source capital can effectively circumvent the escalating demands on the central government’s fiscal resources. Despite the decentralization legislation of the 1990s, Thai municipalities remain financially dependent on the central government for infrastructure investments. The report suggests that these cities are well-equipped with sustainable tax bases and the necessary operational surpluses to accumulate creditworthiness for borrowing.
A “paradigm shift” in attitudes is recommended to pave the way for secondary cities to acquire the authority, resources, and expertise required to back local infrastructure. The report outlines measured steps such as framing a national strategy to lure private investment for public infrastructure, and establishing government units specifically tasked with monitoring local infrastructure projects and planning. Advancement towards this new paradigm hinges on increased flexibility, fiscal independence, and accountability for these emerging secondary cities.
Fabrizio Zarcone, World Bank Country Manager for Thailand, opines, “As Thailand embarks on the journey towards sustainable urban development, local fiscal autonomy stands as an essential pillar.” Highlighting that local fiscal autonomy encourages innovation and fosters a sense of community responsibility, Zarcone contends that this will result in the development of more resilient, self-reliant urban regions.
The study evaluates the feasibility of project proposals in five notable Thai cities – Chiang Mai, Rayong, Nakhon Sawan, Khon Kaen, and Phuket. It delves into key facets that govern financial management by city authorities, including the strategies for capital accumulation for infrastructure investment. Poon Thingburanathum, Deputy Director of Corporate Planning at the Program Management Unit on Area-based Development discusses, “Municipal borrowing and public-private partnerships represent dependable avenues to urban infrastructure development, both tried and tested globally.” He concludes that concerted national effort is pivotal in luring private sector capital towards urban infrastructure investments.
Be First to Comment