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The urbanization of Bangkok: Its prominence, problems, and prospects

So far this chapter has discussed various aspects of changes in the urban system in Thailand. Already, the prominence of Bangkok and its vicinity in urban development and hierarchy have been frequently alluded to. However, since Bangkok is so important for the development of Thailand, this section will take a special look at the growth and urbanization of Bangkok for a better understanding of this capital city.

The growth of Bangkok: Benefits and costs

Although the statistics have shown very clearly how Bangkok has grown in size and importance in the past several decades, the growth in the past few years has been even more striking. The urbanized area of Bangkok in 1974 was already more than twice the size of urbanized Bangkok in the early 1960s (the inner core of old Bangkok and Thonburi), when it began to expand in earnest. By 1984, as shown in figure 9.1, urbanized Bangkok already covered the fringes of surrounding provinces. In the early 1990s, the areas within a 40 km radius of Bangkok Metropolis filled up quickly with housing estates, commercial establishments, and such recreational places as amusement parks and golf courses, thanks to the economic boom of the late 1980s. As will be discussed later, the concept of Bangkok Metropolitan Region (BMR) or Greater Bangkok is fast becoming outdated, and will be replaced by the Extended Bangkok Metropolitan Region (EBMR) within the next few years. In short, the growth of Bangkok is a window for the growth of Thailand.

In analysing the urbanization and growth of Bangkok, one important question often asked by researchers is what are the benefits and costs of such movements.

Fig. 9.1 Bangkok Metropolitan Region urbanized area, 1974 and 1984 (Source: Aerial photograph interpretation, National Housing Authority)

The benefits

The benefits from the growth of big cities are already well known: greater employment opportunities, higher wages and salaries, a lower cost of living owing to scale economies, higher productive capacities owing to spatial agglomeration, more and better social services, more varied cultural and spiritual opportunities, and so on. How true or accurate are these statements for Bangkok?

If the benefits are divided into two or three groups, namely economic, social, and cultural, each can be discussed in turn. As regards economic benefits, probably the most important benefits deriving from the growth of Bangkok are the income and employment opportunities associated with it. National income statistics from the NESDB have shown that, with only 15.8 per cent of total population in 1988, Bangkok and its vicinity generated more than 50 per cent of the gross domestic product. Its GDP per capita of 87,032 baht, the highest in the country, was about 10 times that of the Lower Northeast. In terms of household income estimated from income surveys, average household income per capita in the BMR, which was 29,880 baht, was 2.3 times higher than the national average of 12,766 baht, or 4.4 times higher than average household income per capita of a village in the North-east. As a direct consequence of these income positions, the incidence of poverty was lowest in the BMR. In 1988, only 3.41 per cent of population of the BMR was classified as poor, compared with 23.67 per cent nationwide, or 39.87 per cent in the village North-east. These are but a few of the concrete and testable indications of the benefits associated with the growth of Bangkok. There is little need to mention other economic facts such as that Bangkok is the financial, commercial, investment, and communications centre of Thailand.

Despite the problems associated with the growth of Bangkok, Phisit (1988), who is knowledgeable about the economic and employment potential of Bangkok, has argued that the way Bangkok has grown is necessary and beneficial to the industrialization of the Thai economy. His arguments go as follows. As industrial activities are highly centred on the BMR, it is the single largest durable and nondurable industrial consumer market in the country. The concentration of industrial activities, in turn, generates demand for intermediate inputs, spare parts, and capital goods, which are mainly imported through the Bangkok Port. In the first phase of industrial development, the highest possible return on investment could normally be secured from the concentration of investment in the BMR. The increasing concentration of economic activities in the primate city thus increased the economies of scale and attractiveness, giving the primate city even greater locational comparative advantages. Therefore, a large metropolis like Bangkok is desirable per se in the medium run. Apart from economies of scale, it also provides proximity that is conducive to the first phase of industrialization, allowing the city to absorb large numbers of people in manufacturing jobs, and allowing the government to build up modern infrastructure, which requires a large population in order to operate efficiently. It also serves as a "nodal point" in the network of national and international trade, with modern communications and forming a transport hub of the country. Moreover, Bangkok generates income and employment, and production and trade in goods and services, for domestic as well as international markets. Therefore, instead of trying to control or restrain the growth of Bangkok as a way of solving its urban problems, Phisit would propose that the economic management of Bangkok be made more efficient. In his words:

Analyses of economic structure, social services, population and employment have indicated clearly that Bangkok will continue to grow and play a strategic role as the major social-economic-administrative centre, even if there is a policy of decentralization to promote the development of secondary cities and the new economic zone at the Eastern Seaboard. The future issue is not to stop the growth of Bangkok through physical planning or controlled land use, but to come up with "an effective urban management plan" for the more orderly and efficient growth of the BMR.

As regards social benefits, the following are some of the benefits that set Bangkok apart from the rest of the country:

• About 12 per cent of the BMR population have access to piped water, compared with 1.2 per cent in North, 1.4 per cent in the South, and 0.9 per cent in the North-east.

• There are on the average 7.0 telephones for every 100 residents of the BMR, compared with 1.4 in the Central region, 1.2 in the North, and 0.5 in the North-east.

• More than 12,800 cm3 of water are supplied per 1,000 population in the BMR, which is more than five times the national average of 2,302 cm3 per 1,000 people.

• There are 2.12 hospital beds per 1,000 BMR residents, compared with 0.38 per 1,000 residents in Sri Saket, the poorest province of Thailand.

And so on.

Culturally, Bangkok is the centre of arts and knowledge. The cultural benefits generated in Bangkok may not be quantifiable, but the opportunities and facilities available for leisure and entertainment in Bangkok must be an indication of a high state of well-being and quality of life.7

Although the benefits of Bangkok are apparent and wide-ranging, so too are the costs of the rapid and massive urbanization of Bangkok. In the past three decades or so, the growth of Bangkok has become quite notorious in generating explicit and implicit economic and social costs. In contrast to the list above, some of the damaging consequences of the growth and urbanization of Bangkok are outlined below.

The costs

TRANSPORTATION PROBLEMS. The most critical urban problems of Bangkok today probably involve transportation. Being the fastest-growing area in Thailand in terms of human population as well as automobile population, Bangkok just has not been able to cope with the enormous demand that has been put on its existing road systems. In 1972, police records showed that there were about 243,000 cars in Bangkok (not including motorcycles), and the average speed achieved on a main road was about 23 km/hour. In 1990, the number of cars had increased to 1 million, whereas the length of new primary roads in Bangkok during this 17-year period was only about 82 km. Another Bangkok traffic study by the Japanese International Cooperation Agency (JICA) in 1990 has shown that the peak-hour traffic speed on most of the main roads inside and including the Middle Ring Road was under 10 km/hour. The average speed of regular buses within the Middle Ring Road was recorded at 11.4 km/hour during peak hours, and 15.2 km/hour during off-peak hours. Also in 1990, the Traffic Police Division stated that traffic speeds in Bangkok had declined by an average of 2 km/hour every year. Assuming that this statement was true, and nothing was done about these traffic problems, Bangkok traffic would have come to a standstill in 1995.

A large number of cars and a paucity of roads are not the only factors contributing to the present traffic problems. The lack of efficient public transport systems and of efficient traffic control and the bad driving habits of Bangkok residents also contribute to traffic congestion. The Bangkok Mass Transit Authority (BMTA), the state enterprise that runs the Bangkok public bus service, may be reputed to be the fourth-largest city bus company in the world, but it still does not have enough buses to carry the people of Bangkok. But even if it had, people might still want to travel by private car if there are no disincentives or restraints for them to do so. The neglect and violation of traffic rules are also rampant, such as illegal parking and illegal lane changing, which adds to traffic congestion. The lack of public coordination on the operation and management of Bangkok traffic is also worrisome. JICA has reported that at present there are 11 government organizations having something to do with Bangkok traffic. With a shortage of funds to extend the road network, lack of enthusiasm about doing it even when funds are available, difficulties in expropriating private land for road construction, and so on, the traffic problems of Bangkok become worse every day. Traffic congestion in Bangkok is now among the worst in the world.

AIR AND WATER QUALITY PROBLEMS. Because of the large number of cars in Bangkok, coupled with the traffic congestion and a large concentration of factories, it is not surprising that the air quality in Bangkok is severely affected by those automotive and industrial emissions. A recent study by the National Environmental Board shows that the lead content in the air has increased dramatically during the past few years. During the period 1983-1986, lead monitoring records showed that the lead content of gasoline emissions ranged from 0.1 to 1.0 micrograms per m3. During the period 19871989, however, the lead content went up to 0.6 to 5.45 micrograms per m3, an increase of more than 5 times. And that occurred at a time when the lead content of gasoline had been reduced from 0.85 to 0.45 g per litre. The same monitoring records also showed that, during the same periods, the level of carbon monoxide in the air increased from 1.0-9.5 mg per m3 to 1.1-52.7 mg per m3. Other air pollutants such as ambient sulphur dioxide and suspended particulate matter from industrial emissions also show an increasing trend.

Most of the canals and waterways in the city are also highly polluted, and many of them are already anaerobic and give off offensive smells. This is mainly because the majority of houses in Bangkok discharge wastewater straight into storm drains that directly connect to those canals or waterways. The biochemical oxygen demand (BOD) load in inner-city canals is found to be very high, that is, 2050 mg per litre.8 Even Chao Phraya River, the main river of Bangkok, is under threat of being completely polluted. There is no proper sewage treatment system for Bangkok today, and proposals to deal with the sewage problem have always run into difficulties and have never been implemented.9

A related problem is the supply of water for Bangkok. Owing to Bangkok's rapid expansion, both the residential and industrial demand for piped water was more than the capability of the Metropolitan Water Works Authority to provide it, using surface-water based resources only.10 As a result, underground water is used extensively both publicly and privately, which is the main cause of soil subsidence throughout Bangkok at present. Bangkok is literally sinking at a rate of about 10 cm per year. And if this rate continues, most areas of Bangkok will lie below sealevel within the next decade. Although the problem of flooding in Bangkok is less severe today than, say, a decade ago, owing to extensive use of flood water pumps, the flood prevention system will become more complicated and more expensive as the land continues to sink.

LAND-USE PROBLEMS. The land on which Bangkok is situated is actually paddy field and, as such, is more suitable for rice farming than for residential or industrial purposes. However, the economic development of the country and the importance of Bangkok as the centre of economic activities could not prevent the land from being used for residential, industrial, and commercial centres on a grand scale. Since there is no effective control on land use in Bangkok, the development and urbanization of Bangkok have brought about a haphazard, free-for-all pattern of land use. Residential houses are mixed with commercial buildings and factories, all of various shapes and sizes. Few know or realize that, until early 1992, Bangkok did not have an official city plan in operation. So, a comprehensive city structure, zoning, building control, public utility layouts, and so on, cannot be drawn up. Of course, the city administration does have the power to regulate certain aspects of land use, building construction, and zoning, but the system is piecemeal and not well integrated. Horizontally, the city is spreading along the new roads that are opened up to accommodate the larger urban population and business, industrial, and community demand - typical "ribbon development" that has been going on since the early 1960s when Bangkok started to expand. Vertically, high-rise condominiums, shopping complexes, and business offices began to crop up in the inner part of the city without much coordination with basic ground facilities such as frontage access, drainage, and waste management systems.

Contrary to a common belief that land in inner Bangkok is no longer available for productive uses, plots of unused land still abound in inner Bangkok. This is land that has been left idle or held for speculative purposes because the system of property or land taxes is too weak to have any deterrent effect on such idle or speculative landholdings. With better land-use planning, an efficient property tax system, and effective building control, areas in inner Bangkok could be more efficiently developed and space more efficiently and indeed could help rather than exacerbate traffic congestion.

Prospective solutions to the problems

The above problems are not new; they have just become more serious as Bangkok continues to grow. There is no dearth of studies, plans, guidelines, techniques, and suggestions on how to help solve the problems. As with many other difficulties in solving other economic and social problems, the major obstacles lie in weak political leadership, which is the direct outcome of a weak and immature political system. However, these political issues have to be assumed to be constant in this chapter, so that only technical issues will be discussed.

Traffic problems

On traffic problems, a four-pronged approach has been proposed by the Bangkok Metropolitan Region Development Committee (BMRDC), a multi-ministerial, coordinating committee set up by the Cabinet to direct and oversee the development of the Bangkok Metropolitan Region. The four strategies, with concrete workplans, are described below.11

STRATEGY 1: INCREASE THE ROAD CAPACITY. The workplans of this strategy would call for the construction of many new roads and highways in Bangkok, such as the Second-Stage Expressway linking the northern gateway with the southern gateway, the remaining sections of the Ring Road, completion of several "missing links" of road systems within Bangkok, and the construction of truck terminals on the city fringes to prevent heavy truck traffic into or out of the city.

STRATEGY 2: DEVELOP OR IMPROVE PUBLIC MASS TRANSIT SYSTEMS. The administration of the Bangkok Mass Transit Authority should be streamlined to burden it with fewer restrictions on operating a public bus service for Bangkok, and adopting a new fare system. A new "Sky Train" mass transit system should be constructed. A waterborne public transport system should be further encouraged.

STRATEGY 3: IMPROVE THE TRAFFIC CONTROL SYSTEM. The control of traffic lights should be fully computerized and coordinated with Expressway controls. The enforcement of traffic laws and regulations should be strengthened. And the public should be educated about those traffic laws and regulations, and about rules of good driving.

STRATEGY 4: CONTROL THE VOLUME OF TRAFFIC. Staggered office hours have been suggested to reduce traffic concentration. Public offices are also encouraged to simplify administrative procedures to reduce unnecessary visits by their clients. Heavy trucks should not be allowed to enter the inner city within the next few years. The idea of collecting fees on entering central business districts should be considered. Also, as a means of increasing the traffic flow, curb-side parking should be prohibited where necessary, and parking facilities promoted and expanded.

These strategies look and sound reasonable, and many of the recommended workplans have already been adopted and are being implemented. Within the next Seventh Plan period, much capital will be invested in these traffic-related infrastructure projects in Bangkok. Most notable of all would be the Sky Train mass transit project, the Airport Tollway project, the Second-Stage Expressway project, the Ekkamai-Ram Intra Road project, and (the completion of) the Middle Ring Road project. It is hoped that if all of the above projects proceed as scheduled, they should help provide substantial relief to Bangkok traffic problems.

Air and water pollution

On air and water quality, the government has recently set a timetable for the use of lead-free gasoline in all new cars, and has tried to impose more stringent controls on car emissions. The private wastewater treatment scheme for the BMA should be concluded soon to provide the initial setup for a proper wastewater treatment in Bangkok for the first time. Better solid waste management will also help reduce water pollution caused by the dumping of such waste into the rivers or canals.

Land-use issues

There is a distinct possibility that the Bangkok City Plan will be put to use soon for the first time after several failed attempts in the past 30 years. Bangkok will be divided into 356 blocks with 14 land-use zones clearly separating residential areas from industrial, agricultural, and recreational areas, and so on. In particular, the agricultural areas on the outer fringes of Bangkok outside the Outer Ring Road will be preserved for their original purpose. Industrial factories will be gradually moved to the fringe, and only light and non-polluting industries will be promoted. Flood prevention and soil subsidence measures will be closely enforced. Bangkok in the future will develop in a poly-centric fashion, whereby improved communications and transportation systems will help spread the growth of Bangkok into other areas in the hinterland without putting too much pressure on the management of the city itself.

To conclude, the growth and urbanization of Bangkok are both the cause and effect of the growth of the Thai economy, and, as such, these two components should be considered in relation to each other. The contribution of Bangkok to the overall economic growth and development of Thailand is not in question? but the growth of Bangkok itself has reached the point where it can no longer sustain its traffic, land-use, air, water, and other environmental problems without seriously disrupting the normal functioning of the city and the lives of the people who live in it. Extensive expenditure on traffic and utilities infrastructures will be made in Bangkok in the next few years that are expected to relieve many of its present urban problems. If this is done in time, Bangkok may continue to be the centre of economic activities that link the international community with the rest of the country as well as of the intraregional linkages within the country itself.

Conclusions: towards a new national urban development policy for Thailand

By now, it should be sufficiently clear how Thailand in general has gone through the process of urbanization; what changes in the urban system have taken place as a result of contacts with international economic activities; what kinds of problems its cities are facing during these processes of development and urbanization; and so on. This last section looks at the possibility of a new national urban development policy being adopted in the near future.

Three issues that are believed to have a direct bearing on and relevance for the new national urban development policy in Thailand have been selected for discussion here. These issues are: changes in regional development strategy, changes in the administrative and organizational structures of urban government, and change in the financing of urban activities.

Changes in regional development strategy

The fundamental issue of how best to develop different regions of a developing economy has been debated in urban and regional economics literature for quite some time. The main contending arguments seem to centre on two points; namely, (1) whether such a country should try to slow down the growth or limit the expansion of one or more large cities in the country that have become "over-urbanized," and try to establish growth centres in other lagging regions to balance out the dominance of the existing large city or cities, to keep the rural population within the region by providing them with increased economic opportunities that will eventually "reverse the polarization" of the original large cities, or (2) whether the government should accept as inevitable the rapid urbanization of metropolitan or megalopolitan cities or centres, with all the imbalances and inequities that these cities or centres have generated, and try to spread or diffuse the benefits of such growth to other lagging regions through a series of policies such as stimulating the growth of secondary cities and smaller towns, setting up effective networks with all regions in the country to strengthen the economic relationship between urban and rural areas, and promoting the agricultural exchange and supply functions of market towns. As Rondinelli (1991) concluded in his article on this very issue, the prevailing view nowadays, particularly in Asia, is that policies aimed at creating a "balanced" pattern of urban development, partly by slowing down rural-urban migration and partly by controlling the expansion of metropolitan areas, have failed, and that the diffusion of urban growth, rather than control and suppression, is a preferred policy.

With regard to the case of Thailand, Mike Douglass (1990a,b) also believes in a variation of the diffusion model. In his part of the study on the National Urban Development Policy Framework Project with the TDRI, Douglass argues that the growth pole or growth centre policy, which had been adopted in Thailand since the Fifth Plan, is inferior to what he calls a "regional network" policy. Unlike the growth pole policy, which focuses on urban-based manufacturing as the leading sector for regional development, the regional network policy recognizes the multisectoral nature of local-level development in rural regions and rural or regional resource endowments and already existing activities. Moreover, most growth pole policies adopt an implicit hierarchical central place system based on the importance of the size of the city, whereas the regional network policy finds the city size to be an inadequate indicator of either growth potential or local linkages, and believes that cities of the same size class could have very different functions and development profiles.

According to Douglass, instead of trying to make a single, large city into an omnibus centre for a region, the network concept would rely on the clustering of many settlements, each with its own specializations and localized hinterland relationships. Thus small towns in one area might be made key marketing centres for a certain crop, whereas another town might serve as a cultural centre, and yet another as the administrative centre for the region; and so on. By integrating these centres through transportation linkages and institutional development, the artificiality of central place theory could be overcome.

Along this line of thought, Douglass would argue that the regional inequality brought about by urban-based industrialization could be ameliorated by the regional network approach, which helps to induce urbanization and regional economic expansion through accelerating rural development. Although Thai agriculture has made significant progress in diversification over the past decade, improvements could still be made in the intensification of land use and the production of higher value-added crops for domestic consumption as well as for export. The increase in agricultural productivity would make this rural-led development policy successful, and the development of rural hinterlands would become as important as town-centred or urban investment.

Douglass' ideas seem to have had considerable influence upon the thinking of Thai planners, as the relevant section in the Seventh Plan includes this concept of regional network. However, this regional network concept will supplement rather than supplant the original growth pole concept because, despite the objections propounded in Douglass' study, the growth pole concept was still found to be quite useful, and in its present context was not found to be in conflict with the new regional development concept.

The new regional network strategy entails two important recommendations by Douglass and the research team at TDRI. One is the recognition of the necessity and usefulness of the extended BMR concept; and the other is a new urban hierarchy. The extended BMR concept would recognize that the effect of economic growth has spread beyond the five provinces surrounding Bangkok Proper. To begin with, the growth of Bangkok should be extended to cover other provinces further out, as well as the eastern seaboard areas. Then, through improved communications and transportation networks, the effect of growth would be further spread out horizontally to other areas in a network fashion.

The other auxiliary recommendation is to determine a new urban hierarchy whereby a number of different types of urban centre will be identified for the purpose of linkages between these urban centres and the extended BMR. As part of its analysis of urban spatial development in Thailand, TDRI has analysed the economic potential of each city in the country by applying relevant indicators with different weights to each city. Such socio-economic indicators as average per capita GPP, per capita industrial GPP, per capita deposits in commercial banks, etc. were used. In the end, six levels of cities were identified. Cities at Level 1 are the most developed urban growth centres in the region. A city with a ranking of Level 2 also represents an urban regional growth centre but has high, rather then extraordinary, economic potential. Level 3 and 4 cities are known as community urban growth centres and are typically cities with average (Level 3) or slightly below average (Level 4) economic potential. The classification of Level 5 is limited exclusively to border towns, while Level 6 urban centres are cities with the lowest economic potential in the region.12

In sum, as an example of what could happen under the new urban development scheme, TDRI stated that the regional network strategy would enable the government to target the corridors between major urban centres as sites for industrial parks as well as other higher-order services such as hospitals, universities, or recreational parks in the nearby towns to attract skilled labour from metropolitan areas. The approach was designed to enhance the coordinated expansion of regional clusters of cities and inter-urban corridors rather than simply focusing on a single municipality.

Changes in the administrative and organizational structure

As the new urban development system could not operate effectively in the existing administrative and institutional settings, there must be some changes in the administrative and institutional structures involved in urban management. With regard to the management of the extended BMR, which is a revolutionary urban concept of sorts, TDRI recommended that a new national-level committee be established and charged with the responsibility of setting policy within the extended BMR and managing it. This could be an upgraded Bangkok Metropolitan Region Development Committee (BMRDC), which is already in charge of coordinating the urban policy of the BMR. The Extended BMRDC (or EBMRDC) would be headed by the prime minister, and committee members would consist of high-level officials so that decisions that affect the responsibilities of various government agencies can be effectively implemented.

To be successful, the EBMRDC needs to be assisted by a strong secretariat that has the capability of (a) planning the integrated development of the EBMR; (b) coordinating with various agencies having responsibility for development within the EBMR; and (c) evaluating major infrastructure projects in the EBMR to ensure that they are socio-economically beneficial and are consistent with the desired development directions of the EBMR.

What is equally important, if not more so, is the change in the administrative structure of regional city governments. It is already well known that city governments in Thailand are local governments under the supervision and control of the Ministry of the Interior in Bangkok. Although all regional city governments operate under the administration of municipalities, whose executive officers are directly elected by the local people, these governments still come under the strict control of the Ministry of the Interior as to their fiscal and administrative autonomy. Without effective autonomy in fiscal as well as administrative matters, the city governments cannot perform their duties well. The main obstacle seems to be the entrenched attitude of the Ministry of the Interior in trying to hold on to the power to control local governments. Until there is a genuine change in the autonomy of city governments in Thailand, management of the urban areas will continue to be slow and indecisive.

On a larger scale, there was also a recommendation for change in the administrative and organizational structure at the national level. A new organization, either the Urban Development Bureau or the Ministry of Urban Development, has been proposed to make urban development policy and oversee its implementation. This change might be even more difficult than the decentralization of power to local governments referred to earlier. Therefore, the chance of this change materializing in the near future is quite remote.

Change in the financing of urban activities

Change in the financing of urban activities could be the most important change of all. The successful implementation of the new urban development policy requires adequate and efficient financing. The financial resources needed to fund the infrastructure components of urban development in Thailand in the Seventh Plan are quite large (over 525 billion baht). This ambitious level of infrastructure investment must be funded from a variety of sources, including the central government, local governments, public enterprises, and the private sector. The role of local authorities and the private sector during the next Plan will be much greater than in the previous Plans. As such, the majority of the financial strategies designed to increase the funds available for infrastructure investment rely principally on increasing the resources available to local governments and on increasing and identifying privatization opportunities.

To enable both the central and local (urban) governments to increase their mobilization of resources for future urban development, the following are some of the recommended changes in financing strategies for the new urban development policy.13

(a) improve the efficiency of tax collection and widen the tax base

- Improve the administration and the structure of the Buildings and Land Tax and the Local Development Tax. Administrative modifications could be facilitated by the complete updating of tax maps and rolls. To improve the tax structure, the base of the Buildings and Land Tax will need to be expanded to include owner-occupied houses and public enterprises.

- In the longer term, replace the Buildings and Land Tax and the Local Development Tax with a new Property Tax that is revenue adequate, income elastic, equitable, incentive oriented, and structurally simple.

- Share the revenue generated from the Land Registration (Ownership Transfer) Fee between local and central government. The share of local governments should equal the proportion of their contribution to local infrastructure investment.

(b) Improve service fees

- Establish central government guidelines for fee imposition to be observed by local officials, allowing the exact fee to be levied for any specific service to be at the discretion of the local government.

- Relate fees to the cost of the service, and impose fees when ever beneficiaries can be identified and the benefit is clearly received.

(c) Restructure the present municipal lending organizations

- Create a new organization, perhaps called the Local Government Development Corporation (LGDC), to facilitate funding of local government development and expand local investment opportunities.

- The sources of funding for this organization will be from (i) local governments, (ii) central government, (iii) private financial organizations, and (iv) foreign sources.

(d) Establish a regional development grant

- Establish a regional development grant to be allocated to local governments in high-priority or targeted regions.

- The minimum area for the grants will be the entire province because an urban centre cannot be developed in isolation without concurrent and supportive development occurring in the rural areas surrounding the urban centre.

(e) Modernize the grant allocation mechanism

- Revise the so-called general grant based on per capita allocation to take into account local tax collection efforts. This should provide local governments with incentives to improve their tax collection efficiency.

(f) Other financial strategies

- Impose special assessment levies to mobilize resources from developers for the use of existing and planned infrastructure services. These levies should be imposed whenever conditions, such as the flood protection plan developed for Bangkok, make it possible to do so.

In conclusion, this chapter has demonstrated that the rapid economic development in Thailand brought about in large part by its international contacts and the effects of the globalization of economic growth has caused profound changes in the economy of Thailand and in the way its people live and work. Increased urbanization and the changes in the urban system that accompany urban growth have further created problems never before experienced, problems in the settlement of people and problems with the environment. The contrast between the benefits of economic growth and urbanization and the costs to the quality of life and the environment appears to be very vivid in the case of Thailand. Bangkok has exemplified the benefits and costs better than any other city in the country, and has become the most progressive, most dynamic, richest, and, at the same time, most polluted and congested city in Thailand.

The international implications of this process of urban change are several. Although it is more positive to see the growth of Bangkok as the growth of a "fringe" area in the context of the vast area of the "borderless" Asia-Pacific region, together with the growth of other fringe areas such as Manila, Shanghai, or Jakarta, it could contribute to the dynamic nature of global economic connections. These connections lead to further growth and prosperity, but the growth that Bangkok represents cannot be called sustainable growth in view of still considerable internal or regional inequality. Perhaps a more appropriate policy would be to pay more attention to long-term urban stability so that the growth becomes more equal and more diffused throughout the economy, rather than to be satisfied with the short-term economic prosperity that Bangkok seems to portray.


In writing this paper, I have benefited from the data and analyses on the National Urban Development Policy Framework Project by a research team at the Thailand Development Research Institute (TDRI) of which I was an associate member. However, they were not responsible for the content of this paper.

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