Thailand approves $US2.9 billion infrastructure fund

The Government of Thailand has approved a $US2.9 billion (100 billion baht) infrastructure fund to finance transportation and power projects in the Kingdom, reports the Infrastructure Journal.

The Thailand Future Fund, which has finally launched after being delayed by the military government, aims to raise an initial $US1.2 billion in Q3, said Ekniti Nitithanprapas, director-general of the State Enterprise Policy Office.

The government will inject $US293 million (10 billion baht) into the fund before selling units to the public. Participation in the fund is open to both foreign and Thai investors with an expected yield of seven to eight per cent, said Finance Minister Apisak Tantivorawong, quotes Reuters.

The fund forms part of the financing for a $US25.2 billion Thailand Infrastructure Action Plan for 2017, approved by the Cabinet in December for 36 infrastructure projects, covering rail, roads, air transport and ports throughout the Kingdom.

The announcement comes at a time of increased debate on the funding gap in Asian infrastructure and the extent of private sector participation, articulated in a recent Reuters IFR Asia article.

A recent Asia House conference on the Asian Development Bank’s report ‘Meeting Asia’s Infrastructure Needs’, and a talk last week by the Asian Infrastructure Bank’s Joachim von Amsberg highlighted the current funding challenges for Asian governments.