Bangkok could benefit from Hong Kong transit model

WATCHDOG: Bangkok could benefit from Hong Kong transit model - The Nation, January 29, 2006
...From the outset, the Hong Kong government provided loan guarantees to the state agency responsible for MTR development.
This allowed the state-owned MTR authority to acquire credit at low interest rates, which was suitable for a large and long-running investment in the infrastructure of its system.
As for Thailand, part of this model was used by the MRTA about a decade ago when it invested in the infrastructure for the first 20 kilometres of the subway line.
Unfortunately, the additional cost of some Bt20 billion to purchase rolling stock and related equipment was later shouldered by private firm BMCL, which was in return granted a concession to run the subway.
According to de Baecque, private investors are not suitable for this kind of long-term investment. He cited the BTS company as an example. When BTS first invested more than Bt50 billion in the 23-kilometre Skytrain, the project was hailed as the first 100-per-cent private-investment scheme of its kind in the world.
In the wake of the 1997 Asian financial crisis, BTS technically went bankrupt due to huge foreign loans and exchange losses.
Today the company is still struggling with its unfinished debt-restructuring programme. Hence 100 per cent private investment in mass transit does not work in the long run...
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