TDRI: National credibility at stake over telecom favouritism

TDRI: National credibility at stake over telecom favouritism

Thailand Development Research Institute president Somkiat Tangkitvanich renews his warning against helping AIS and True Move on the relief payments. (Post Today photo)
Thailand Development Research Institute president Somkiat Tangkitvanich renews his warning against helping AIS and True Move on the relief payments. (Post Today photo)

Thailand Development Research Institute president Somkiat Tangkitvanich on Sunday warned the government of losing investor confidence if generosity is given to two telecom operators.

"What's more important than investors' confidence in a company is national credibility. If the government changes its policy, rules or conditions because of an unreasonable demand of some operators, it will tarnish the country's image," Mr Somkiat posted on Facebook.

His comment came ahead of the cabinet decision on Tuesday of the controversial relief plan for Advanced Info Service Plc (AIS), the largest mobile operator by subscriber numbers, and second-ranked True Move.

At the heart of the controversy is a plan backed by the National Broadcasting and Telecommunications Commission (NBTC) based on the two telecom companies' requests. It involves extending their final payments of the 900-MHz licence fees by allowing them to pay in five yearly instalments plus 1.5% interest.

They are contractually required to make the last payments in lump sums in 2020 -- 59.5 billion baht for AIS and 60.2 billion baht for True Move.

The NBTC move followed calls by AIS and True Move late last year to seek more generous payment terms from the government through the use of Section 44.

The plan was tabled for cabinet consideration two weeks ago but Prime Minister Prayut Chan-o-cha put the brakes on it. He asked the NBTC for a review by taking into consideration public interests and sent the issue back for reconsideration.

After reviewing the proposal, NBTC secretary-general Takorn Tantasith decided not to change anything, saying the country would benefit from the relaxed payment terms since the two companies would have to pay a 1.5% interest rate during the extended period. By allowing them to pay in instalments, the pair can free up funds to bid in the upcoming 1800MHz spectrum, instead of leaving third-ranked Total Access Communication Plc (DTAC), the sole contender, he added.

Mr Somkiat on Sunday called the NBTC's explanations a "strange logic", apparently aimed at "carrying" the operators, as the pair have had shown no signs of financial difficulties running the businesses.

He dismissed as unreasonable the regulator's claims that the country would stand to gain from the interest. "If they are unable to pay in lump sums, the contract stipulates they will be fined at a punitive rate of 15% a year, which is much higher than the 1.5% the NBTC hopes to get," he said.

On Saturday, the two companies argued allowing them to make the last payments in instalments would cost the country nothing since they are willing to pay the interest over the extended period.


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