Government policy changes related to
financing, implementation and conceptual design have
hampered the implementation of this $3.2 billion heavy
rail system since first planned in the mid 1970’s.
Although no construction has begun, the project is
planned to have two major 10-kilometer components,
one between central and northeastern Bangkok, the
second between northeastern and northwestern
Bangkok. Current plans call for the entire 20 kilometers
to be underground.
In 1990, consortium lead by Canada’s SNC
Lavalin gained rights to negotiate building the project
but was canceled by the government when the
consortium’s financing arrangements were not
approved. When the government later decided that all
mass transit systems in the 64-square kilometer area of
central Bangkok must be underground, the projects
concession awarded in 1993 to property developer
Bangkok Land was also terminated and the government
decided to take control of the project.
Because the transit authorities studies indicated that returns to the private sector for the
overall system would not be attractive to commercial investors, the government decided to fund
80 percent of the project costs, those related to civil engineering and construction, using bonds,
commercial loans and soft loans. A private sector concession, however, would be selected to
finance the trains and equipment as well as operate the system, as returns to the private sector
were deemed attractive for these operating elements of the system.
The project is scheduled to open the first phase in December 2002, the whole project
would be completed in 2003 with the estimated ridership of 404, 880 passengers per day. MRTA
expects to recover its investment in 25 years with an internal rate of return of 11.32 percent.
Recently, three additional routes, which extend to the out skirt, have already been approved, but
the “Bangkokians” would have to wait for 5 years or more to see the first piece operated due to
the country’s money shortage.