Megaproject loans sought

Written by changthai11 on Friday, October 10th, 2008

CHATRUDEE THEPARAT

The Finance Ministry will seek up to $1.5 billion in loans from the World Bank and Asian Development Bank to boost domestic liquidity and finance the government’s megaprojects.

Finance Minister Suchart Thada-Thamrongvech said the ministry would seek $1 billion in loans from the ADB and $500 million from the World Bank at the annual meetings of the World Bank and International Monetary Fund to be held in Washington next week.

The Finance Ministry would also propose to its Chinese, Japanese and Singaporean counterparts a regional mechanism to help buffer the impact of the global financial crisis. “Asia needs to establish a mechanism to help stabilise the financial markets of the region,” Dr Suchart said, but declined to offer details.

Financial markets over the past few weeks have been in freefall. International banks have teetered on the verge of bankruptcy as the credit markets have frozen due to uncertainties about the stability of international financial institutions.

Although the crisis is expected to sharply reduce global growth, affecting Asia’s export-dependent economies, Dr Suchart said he was confident Thai growth would remain on target, at 5% this year, thanks to strong export growth.

But new fiscal measures are needed to insulate the economy in 2009, and authorities are studying measures to develop new export markets in the Middle East, Africa and Latin America, provide low-cost funding for small and medium-sized companies and jump-start investment in the southern border provinces.