Makkasan land handover hits obstacle

Makkasan land handover hits obstacle

Council of State checks SRT lease plan

A bird's eye view of the 497-rai Makkasan land which the State Railway of Thailand plans to lease to the Finance Ministry to clear its huge debts. (Photo by Krit Promsaka na Sakolnakorn)
A bird's eye view of the 497-rai Makkasan land which the State Railway of Thailand plans to lease to the Finance Ministry to clear its huge debts. (Photo by Krit Promsaka na Sakolnakorn)

The planned handover of the 497-rai Makkasan area by the State Railway of Thailand (SRT) to the Finance Ministry to clear huge debts has been suspended until legal concerns are settled.

Chakkrit Parapuntakul, director-general of the Treasury Department, said the hand-over is on hold pending a review by the Council of State, the government's legal adviser, after legal questions were raised about the land.

There are legal concerns over whether the "Makkasan plot", part of which was appropriated specially for use in rail system development, can be developed for other purposes, he said.

The hand-over is part of an agreement in which the SRT will lease the land to the Finance Ministry for 99 years in a deal worth 61 billion baht in return for SRT debt being written off to the same value.

Under the plan, the SRT would release 105 of the 497 rai to the Treasury Department after it signs a memorandum of understanding with the department, with another 30 rai to be handed over within one year and the remainder within two years.

The Treasury Department plans to develop the land into a commercial area and public park with an estimated investment of 200-300 billion baht.

A source at the Finance Ministry said the land lease agreement is part of the SRT's rehabilitation plan which hopes to clear part of its 110-billion-baht debt.

It has devised measures to improve the agency's financial health.

The SRT plans to offer another three pieces of prime land for commercial development including a site near Mae Nam railway station in Klong Toey district covering a total of 277.5 rai while gearing up to re-evaluate 7,000 land lease contracts to better reflect market prices.

The State Enterprises Policy Commission, or the superboard, has set up a working committee to supervise land use under the SRT that has more than 10,000 land lease contracts covering 36,000 rai.

Some 7,000 contracts expire this month.

The committee is chaired by Amnuay Preemonwong, deputy permanent secretary for finance.

The development plan for the Makkasan are has drawn criticism from the civic sector which has called on authorities to gather public input before proceeding.

The 497 rai of land currently houses one of Bangkok's precious green areas covering about 150 rai, a 30-rai grant for a museum and structures that are recognised for their architectural and historical value.

At a recent seminar on development in Bangkok, participants repeated their calls and urged the government to set new standards for megaproject developments starting with the Makkasan area.

Prinya Chukaew, an architect and town planning expert from King Mongkut's Institute of Technology Lat Krabang, said the government should seize this opportunity to include the local community and civic sector in the development of megaprojects.

He said while the participatory process may take some time at the beginning, things will move at a speedy pace and without opposition or resistance once a conclusion is reached.

Sawit Kaewwan, core member of the SRT's labour union, said critics of the development are not opposed to changes, but they want authorities to look at all aspects, not just the economic returns.

"Makkasan has a long history and its development should be carried out in a sustainable fashion. It shouldn't be just about clearing debts, part of which are due to the SRT's policy to provide public services," he said.

Pongprom Yamarat, of Big Tree group, said the Makkasan development project is among other multi-billion-baht projects that have raised doubts over development policies which focus on financial payoffs.

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