“New Thailand”: 800 Billion Baht Re-Build and Serious Legal Reforms?

Following the floods that have caused major devastation in Thailand and may halve Thailand’s GDP growth, the Thai Prime Minister has proposed a mega-project called “New Thailand”, which will involve up to 800 Billion Baht in subsidies and legal reforms in the areas of customs and work permit laws.  The Bangkok Post’s report on the New Thailand project quotes the Thai  Energy Minister, Pichai Naripthaphan, as saying: "Several countries such as the United States, the Netherlands and Japan, have proposed rehabilitation plans for Thailand. Their packages include loans and technology for our country, but the government has yet to decide,…"  A subsequent Bangkok Post article  says: “Japan is prepared to offer unlimited soft loans for 40 years at interest of less than 1% to the Thai government to help fund infrastructure to prevent floods and drought in the long term.”  This same article quotes Mr. Prichai as saying: ‘the Japanese government suggested Thailand invest in projects that could prevent problems for 100 to 200 years and not just 10-20 years.”

Any rehabilitation plan involving these countries will, of course, require serious improvements in transparency, more rigorous enforcement of anti-corruption laws, and a commitment to the use of neutral arbitral venues to resolve any disputes that might arise in such a major rehabilitation effort.  There is already talk of easing Thailand’s investment laws, but nothing concrete has been put forward yet.