Cross-Border Infrastructure: A Toolkit

Mass Transit:
Comparison of Bangkok & Kuala Lumpur

Session on Private Sector Participation

Yong Hee Kong
PPP Resource & Research Centre, Kuala Lumpur

The views expressed here are those of the presenter and do not necessarily reflect the views or
policies of the Asian Development Bank (ADB), or its Board of Directors, or the governments they
represent.

Cross-Border Infrastructure: A Toolkit

KL: Historical Background

Study by JICA 1987
Appeared in Mid-Term Review of 6th Malaysia Plan
(1994)
Appeared in subsequent Malaysia Plan. Lack of budget.
Started in early 1990s, completed in August 2003.
Governments intention to create integrated rail transit
network, part of multi-model urban transport system.

Cross-Border Infrastructure: A Toolkit

KL: Overview of Urban Rail Network

Four components:
KTM
LRT

Komuter (157 km electrified double track system)

1 and 2 (STAR and PUTRA)

ERL (to

KLIA airport)

KL Monorail

Cross-Border Infrastructure: A Toolkit

KL: Privatized Urban Rail Transit System

Cross-Border Infrastructure: A Toolkit

KL: Urban Rail Transit Network

Cross-Border Infrastructure: A Toolkit

KL: Benefits of Privatization

Reduced traffic congestion and time-saving.
Positive impact on urban environment.
Improved safety.
Relieved governments admin and financial burden.
Promotion of economic growth.
Helped to meet social target.

Cross-Border Infrastructure: A Toolkit

KL: Issues
Reasons behind the need to privatize urban transit
system (10 years in the making)
Reasons for negotiated bidding
Over-estimation of passenger figures

Cross-Border Infrastructure: A Toolkit

KL: Negotiated Bidding

Cross-Border Infrastructure: A Toolkit

KL: Over-Estimation of Passenger Figures

Cross-Border Infrastructure: A Toolkit

KL: Need for Restructuring and Improvement

Both LRT (STAR and PUTRA) nationalized in
September 2002
SPNB - takeover assets & liabilities
RAPID - takeover operations
Steering Committee (INSPAK) formed to push for
integration of all transport systems in Klang Valley.
ERL and KL Monorail still struggling financially.

Cross-Border Infrastructure: A Toolkit

KL: Lessons Learnt

Over- estimation of ridership
Overall authority body - to ensure vertical integration
of systems
Requires public sector subsidization to make fares
affordable

Cross-Border Infrastructure: A Toolkit

Bangkok Mass Transit Schemes

Three separate schemes were initiated in the 1990s
Bangkok

Transit System (BTS or Skytrain)

Hopewell

elevated rail project

The

subway (20 km underground rail)

Cross-Border Infrastructure: A Toolkit

Cross-Border Infrastructure: A Toolkit

Bangkok Hopewell
Concession given to Hopewell Company
60km multimodal transport system - elevated toll road,
MRT, local road improvement and a port rail
Financial attractiveness from property development rights
on SRT-owned land
Property boom collapse during 1997 financial crisis
14% completed
Government terminated concession in 1998

Cross-Border Infrastructure: A Toolkit

Bangkok - Skytrain
Opened in late 1999 running on elevated heavy rail system
above Bangkok commercial areas
23 km and 23 stations, cost US 1.5 billion
Riderships below forecast
1st

year, quarter of forecast

current,

third of forecast

Fare box sufficient to cover operating and maintenance costs

but not capex.
Financial problems, debt of more than BT40 billion
Restructuring plan not yet approved by creditors
Talks of government buying over the debts (and company)

Cross-Border Infrastructure: A Toolkit

Bangkok - Subway
Private operates (BMCL) on 25-year concession from Mass
Transit Authority of Thailand. Public sector paid for
construction, concessionaire paid for trains (80:20 funding).
Construction started November 1996, opened on August
2004.
20 km long with 18 stations and 3 interchange stations (to
Skytrain).
Average ridership below expectation at 140 000 p/d.

Cross-Border Infrastructure: A Toolkit

Lessons Learnt
Low ridership - below forecast
Holistic

approach required with vertical integration.

High

initial capex - cost recovery result in relatively

high fares compared to alternative transportation

Linking transport infrastructure development to profits

of property development is an insecure basis for
ordered progress (Hopewell).
MRT helps stimulate economic growth - e.g. rental
rates of buildings gone up.