World Bank Document

1 Public Disclosure Authorized Document of FILE COJP. Y. The WorldBank FOR OFFICIALUSE ONLY. Report No. P-2367-TH. Public Disclosure Authorized REPORT AND RECOMMENDATION. OF THE. PRESIDENT OF THE. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT. Public Disclosure Authorized TO THE. EXECUTIVE DIRECTORS. ON A. PROPOSED LOAN. TO THE. KINGDOM OF THAILAND. FOR THE. bangkok traffic MANAGEMENT PROJECT. Public Disclosure Authorized November 30, 1978. This Document has a restricted distribution and may be used by reciplents only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY. EQUIVALENTS. Currency Unit = Baht (B). US$1 = B 20. B I = US$ B I million = US$50,000. MEASURES. AND EQUIVALENTS.

2 1 meter (m) = inches (in). 1 square meter (sq m) = square feet (sq ft). 1 cubic meter (cu m) = cubic feet (cu ft). 1 kilometer (km) = mile (mi). 1 hectare = 10,000 sq m or acres ABBREVIATIONSAND ACRONYMS. BMA - bangkok MetropolitanAdministration BMTA bangkok Mass Transit Authority EGAT - ElectricityGeneratingAuthority of Thailand ETA - Expresswayand Rapid Transit Authority IEAT - IndustrialEstates Authority of Thailand IFCT - IndustrialFinance Corporationof Thailand MWWA MetropolitanWater Works Authority NGOT - Natural Gas Organizationof Thailand RTG - Royal Thai Government TOT - TelephoneOrganizationof Thailand UTPO - Urban TransportationPlanning Office GOVERNMENTOF THAILAND. October 1 - September 30. FOR OFFICIAL USE ONLY. THAILAND. bangkok traffic MANAGEMENT PROJECT.

3 Loan and Project Summary Borrower: Kingdom of Thailand Beneficiaries: B'angkokMetropolitanAdministration(BMA); bangkok MlassTransit Authority (BMTA); traffic Police D)ivision;and Urban TransportPlanning Office (UTPO). Amount: $16 million Terms: 20 years, including five years of grace, with interest at per annum. Project Description: The purpose of the project is to make bangkok 's existing transportationsystem more efficientwith mninimumadditionalinvestmentsand to strengthen appropriatetraffic related institutions. The lprojectwould consist of: (a) specificpolicies to discouragethe use of low occupancy vehicles includ- ing area pricing,parking controls, and staggering of working and school hours; (b) strengtheningof urban traffic management through provision of tech- nical assistance,trainingand trafficmonitoring iequipment,(c) low-costmeasures to increase the capacityof the urban road network, such as traffic signallingimprovements,constructionof selected road flyovers and road links, street widening, junction improvementsand improved road signing.

4 And (d) improvementof the managementand operation of public transport through technicalassistanceand training. The project entails risks, principally related to political acceptanceand enforcementof the proposed area pricing scheme. These risks, 'however,should be weighted against the exceptionally large economicbenefits that successfulproject implementationwould generate. All road users in bangkok will benefit, with lower-incomegroups who travel by public transportbenefitingrelatively more than the more affluent. This Document has a restricteddistribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. - ii - Project Cost: -- $ million --------- % of Local Foreign Total Total Policy measures /a 1.

5 Urban management /b 9. Road capacity increase /c 56. Public transport improvement 5. Design and supervision - 7. Contingencies: Physical 11. Price 11. Total 100. Financing Plan: -------- $ million --------- % of Local Foreign Total Total IBRD 0 47. Government 0 53. Total 100. Estimated Disbursements --------- $ million -------- from Bank loan: Bank FY: 1979 1980 1981 1982. Annual: Cummulative: Rate of Return: 56% on about 94% of project investments; , excluding those associated with policy changes. If such policy changes are included, the overall rate of return would be about 140%. Appraisal Report: No. 2105a-TH, dated November 30, 1978. /a Signing, sales outlets, gantry signs. /b In addition, the UK Transport and Road Research Laboratory will provide, on a grant basis, about $72,000 worth of project monitoring assistance to UTPO.

6 /c Including acquisition of land and property, $ million. REPORT AND RECOMMENDATION OF THE PRESIDENT. OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT. TO THE EXECUTIVE DIRECTORS. ON A PROPOSED LOAN TO THE KINGDOMOF THAILAND. FOR A BANGKOKTRAFFIC MANAGEMENT PROJECT. 1. I submit the following report and recommendation on a proposed loan to the Kingdom of Thailand for the equivalent of $ million to help finance a bangkok traffic Management Project. The loan would have a term of 20 years, including five years of grace, with interest at per annum. PART I - THE ECONOMY /1. 2. A Basic Economic Report entitled "Thailand - Toward a Strategy of Full Participation" (2059-TH) was distributed to the Executive Directors on September 18, 1978. The Report forges a link between the overall development of the economy and the extent and incidence of poverty.

7 It concludes that Thailand's rapid economic growth over the past 15 years has led to a significant reduction in absolute poverty, but that nevertheless important groups have lagged behind. It identifies the essential characteristics of these groups and points to the need for continued rapid overall development as well as the initiation of specific measures to deal with the poverty problem. It further discusses the constraints that will have to be faced if these policies are to be successfully implemented. Country data are given in Annex I. Recent Political Developments 3. Despite frequent changes at the top levels of government, there is a fundamental stability in Thai society and the bureaucracy. Recent changes in governments have mainly reflected differences in view about Thailand's external relations and on -thepolitical decision-making process within the country.

8 With regard to external relations, the civilian government formed in November 1977 under the Prime Ministership of General Kriangsak Chomanan, then Commander in Chief of the Army, has moved successfully to consolidate Thailand's external position by improving and stabilizing relations with Thailand's Indochinese neighbors and by strengthening relations among its ASEAN partners. Domestically, under the interim constitution promulgated by the Kriangsak Government, a general election was to be held within one year of its formation. However, the new constitution has not yet been approved and elections are likely to be postponed until early 1979. 4. A broad concensus has been developing over the last several years on the priorities for socioeconomic development.

9 This is reflected in the fact that all recent governments have endorsed the objectives and major strategies of the country's Fourth Five-Year National Economic and Social Development Plan (1977-81). There is now increasing concern to achieve a widespread /1 Parts I and II of this report are essentially the same as in the recent President's Report (P-2404-TH) dated November 1, 1978 for the Second Northeast Thailand Irrigation Project, distributed to the Executive Directors on November 2, 1978 under cover of Secretary's memorandum R78-243. distribution of the benefits of growth. The Government is increasingly turning its attention towards socioeconomic issues, recognizing that an improvement in the conditions of the poorest farmers and those living in the more remote areas is not only desirable by itself, but would also counteract insurgency in the long run.

10 Past Socioeconomic Trends and Recent Changes 5. Thailand's economic performance since 1960 has been good. Although there was some deceleration in recent years, the average annual real GDP. growth rate from 1960 to 1977 was , or per capita. Real agricultural growth of 5% was a leading factor sustaining this expansion. The cultivated area increased by about 4% per year, water control was improved, irrigation expanded and the cultivation of relatively new crops, including maize, cassava, kenaf, sugar and rubber, grew rapidly. As a result, agriculture has also been a major contributor to export growth. The Government maintained economic and price stability throughout the period and encouraged private savings and investment. As a share of GDP, domestic savings fluctuated between 19% and 24%, and total investment between 20% and 27%.