EARTH Thailand

Academic fears concession will lead to land grab in Eastern Economic Corridor

The Nation 02 May 2017 | PRATCH RUJIVANAROM

An academic has warned that foreign investors will receive too many privileges under the Eastern Economic Corridor (EEC) Bill, which could lead to serious land problems in the Eastern region.

Decharut Sukkumnoed, the lecturer at Faculty of Economics Kasetsart University, said there were alarming issues regarding the EEC Bill that would exempt foreigners from many leasing conditions and give too many privileges to foreign investors that would not benefit the country.

“It is true that Thai law has allowed land leases for foreigners for 99 years since 1999, as the National Council for Peace and Order has always explained. The law allows foreign investors to lease land for 50 years and they can extend for another 49 years,” Decharut said.

“However, the Land Leasing for Commerce and Industry Act contains a lot of conditions that investors have to meet before being allowed to rent the land, and these conditions are excluded from the EEC. In the end, this will lead to a tremendous land grab in the Eastern region and harm the land rights of local people.” 

He said Article 43 of the EEC Bill stated people operating in the EEC area could receive privileges, including foreigners allowed to occupy the land.

Article 44 stated that foreigners could receive privileges without complying with the Thailand Land Code, which meant that investors who secured a permit from the EEC Office could lease the land without conditions.

He said Article 46 of the EEC Bill also waived Article 5 of the Land Leasing for Commerce and Industry Act, which stated that foreign investors could lease land for 50 years and extend for 49 years, but they had to meet conditions stipulated by the ministerial regulations and receive permission from the Lands Department director-general.

According to the Lands Department, there are two types of foreign land leasing allowances, covering property less than 100 rai (16 hectares) and more than 100 rai. 

Leasing land of less than 100 rai has three main conditions. First, the land must be in a zoned area within the city plan. Second, investors must invest more than Bt20 million in commercial sectors or invest in a promoted industry. Third, foreign investors must not invest in prohibited businesses.

For land leases of more than 100 rai, all three conditions also apply, but the business must also benefit Thailand’s economy, such as boost the employment rate, increase exports or be a promoted business according to the government.

“The exemption of the article means that not only is the power of the Lands Department director-general to grant or cancel the land-lease allowance bypassed, but also the conditions for foreign investors are lifted as well,” Decharut said.

“This is very concerning, because the ECC Bill signifies that if investors get permission to lease land from the EEC Office, they can lease any new land within the EEC without asking for permission from authorities again.”

He said he was concerned the bill would transfer power from the Lands Department to the EEC Office, which ordinary people would not be able to influence, to allocate large areas of land, which could lead to a significant land grab in the Eastern region.

“The bill also states that the EEC Office can gather land for special economic zone development by purchasing, appropriating or reclaiming land from the sea, so it is very likely that large amounts of land will be taken from local people’s hands and distributed to investors,” he said.

“This is wrong at many levels. In the long-term, land leases will not be attractive to the technology base that the government wants to attract, but also the law will violate local people’s rights to access limited land resources.”

Decharut said the government should attract technology-based investments by providing tax benefits instead, as providing a large area of land for a long period of time was not beneficial to that kind of investment.

He added that tax breaks were more logical as the government would be a direct beneficiary of investment in the EEC.