Kitiphong Thaichareon, Reuters 29 Dec 09;
BANGKOK (Reuters) - Thailand on Tuesday approved regulations on health and environment assessments for industrial projects, a step toward allowing suspended operations to go ahead at the world's eighth-biggest petrochemical hub.
A court has suspended 65 new plants at Map Ta Phut, Thailand's biggest industrial estate, for their owners' failure to carry out health impact assessments (HIA). The government was blamed because it had not set up a body to oversee the HIAs.
The ruling stoked concern about legal uncertainty and government competence in a country once seen as a safe haven for investment but now mired in five years of political strife.
"The cabinet has approved the draft regulations ... about guidelines to comply with environment and health impact assessments," a deputy government spokesman told reporters.
The government's move at least clarifies what companies need to do to get health impact clearance, but an independent commission to carry out the assessments has still not been set up and some companies fear this could be the main sticking point.
A panel chaired by former premier Anand Panyarachun has agreed to form that body but there are concerns about delays if parties in the dispute challenge who sits on the commission.
Analysts say the credibility of Prime Minister Abhisit Vejjajiva's embattled pro-business government and its economic revival efforts could be hurt if it fails to resolve the dispute quickly.
DELAYS COSTLY
The central bank says the suspensions could cut GDP growth by up to 0.5 percentage point next year, while an industry ministry estimate last week said a protracted legal standoff could cost as much as $18 billion.
According to the new regulations, companies building plants are now required to hold public hearings into the environmental and health impact. Local people were not previously consulted.
The court injunction followed complaints from local people and environmentalists that state agencies and ministers had failed to issue proper operating licenses at the 6.5 sq km (4,086 acre) estate in eastern Thailand. A local lobby group says some 2,000 cancer deaths were caused by pollution from the estate.
On December 2, a court allowed 11 of 76 suspended projects at Map Ta Phut to proceed, but the other 65 projects worth an estimated $8 billion remained frozen.
Last week the court allowed a venture partly owned by Siam Cement, Thailand's top industrial conglomerate, to resume operations because its license had been granted prior to the promulgation of the 2007 constitution.
Companies at the estate include top energy firm PTT, PTT Chemical and utility Glow Energy. Among the foreign companies are a Thai unit of Germany's Bayer and Australia's BlueScope Steel Ltd.
The government agreed last week to back court appeals on 19 projects it deems safe enough to resume operations, while state-controlled PTT will seek the go-ahead for its nine suspended projects, given that they, too, received operating licenses before the 2007 constitution.
(For a Q+A on the Map Ta Phut dispute:)
(Writing by Khettiya Jittapong; Editing by Martin Petty)
