The Asian Development Bank (ADB) on June 4 announced the signing of an agreement with a financing package of 9.9 billion baht (US$311 million) for the construction and operation of two new lines of Bangkok’s mass rapid transit (MRT) system.
The financing package is comprised of two 4.95-billion-baht loans to the Northern Bangkok Monorail Company (NBM) and the Eastern Bangkok Monorail Company (EBM) for the construction and operation of the two new lines, called Pink and Yellow Lines. These will add to the five existing lines currently operating in Thailand’s capital area.
The Pink Line, under NBM, will operate between Min Buri district in Bangkok and Khae Rai in Nonthaburi province, with a total length of about 34.5 kilometres. EBM’s Yellow Line will operate between Lat Phrao in Bangkok and Samrong in Samut Prakan province, with a total length of about 30 kilometres.
NBM and EBM are special purpose vehicles established by BSR Joint Venture (BSR) to operate the Pink and Yellow MRT Lines, respectively. BSR is a joint venture comprising BTS Group Holdings Public Company Limited, Sino-Thai Engineering and Construction Public Company Limited, and RATCH Group Public Company Limited.
The deputy director-general of ADB’s private sector operations department, Christopher Thieme, says the bank’s assistance will catalyze commercial financing for Thailand’s MRT sector and help provide a wider choice of affordable and efficient public transport for Bangkok’s rapidly growing population. He notes Bangkok’s continued status as one of Southeast Asia’s global business hubs depends on relieving traffic congestion and increasing sustainable public transport services.
BTS Group executive director and deputy CEO Terence Kong says that ADB’s involvement as a lender enhanced the overall bankability of the project by providing a long tenor repayment profile. It will also provide more flexibility on cashflow management and help mitigate ridership risk at the opening stage of the project.
Bangkok is infamous for its heavy traffic congestion with some studies describing Thailand's capital as among the most congested cities in the world. According to ADB, the proportion of travellers using MRT as a share of total transit in Bangkok remains low compared to other peer cities. The number of private cars in Southeast Asia has more than doubled since 2000, and 30 million more passenger cars are expected to be added by 2040. The new lines will help cut down on air pollution from vehicles and greenhouse gas emissions, while also tackling traffic congestion.