The Finance Ministry of Thailand looks set to benefit from the government deciding to speed up amending the land-lease law as it prepares to lease a massive plot of prime central Bangkok from the State Railway of Thailand, The Nation reported. The long-term lease period is set to be extended from 50 years to a maximum of 99 years.
Prime Minister Prayut Chan-o-cha instructed the Transport and Interior ministries to fast-track the amendment to help finds a permanent solution to the SRT’s financial problems at the most recent meeting of the State Enterprise Policy Committee. Continuing losses have plagued the SRT over the years and this could help offset some of the debts.
This will allow the Finance Ministry will lease a prime plot of land at Makkasan from the SRT for 99 years. The ministry aims to develop several commercial property projects worth a combined THB61.8 billion at the site, according to The Nation. The Finance Ministry will write off the accumulated debts of the SRT totaling nearly THB100 billion.
Kulit Sombatsiri, director-general of the State Enterprise Policy Office, told the newspaper that the land-lease law for commercial and industrial development must be amended before the Finance Ministry can rent the SRT’s land plot for 99 years. The current law only allows long-term leases of up to 50 years.
The government also planned to promote the private sector’s investment in special economic zones along the country’s borders with neighboring countries through long-term land leases that could be extended from 50 years to 99 years. The zones where the lease extension would be eligible are Mae Sot district in Tak bordering Myanmar, Aranya Pathet district in Sa Kaew bordering Cambodia, Trat bordering Cambodia, Mukdahan bordering Laos, Sadao district in Songkhla bordering Malaysia and Nong Khai bordering Laos, according to The Nation.
Thai and foreign investors want to see long-term land leases extended beyond the current limit of 50 years to make the projects financially feasible. These projects often come with massive capital investment required for the development and longer lease terms would make them more desirable
