Problem overview:

     Awareness and visions: Thailand has been well aware of the need to protect the environment to sustain the country's development. Natural resources and environmental protection have been emphasized since the early 1980s. The agencies responsible for the environment have been strengthened; the Polluter Pays Principle (PPP) has been adopted; and public investment in organic and inorganic waste treatment facilities has increased significantly.

     Policies and measures: The Environmental Fund was created by the Enhancement and Conservation of National Environmental Quality Act of 1992 as a financial measure to create incentives and support efforts to resolve urgent environmental problems under participation of all concerned sectors and in accordance to Polluter Pays Principle.

Background in summary:

     Objective of the Environmental Fund: The Environmental Fund was established under the Enhancement and Conservation of National Environmental Quality Act of 1992. The objective is to promote solution for environmental problem with participation of all sectors, through provision of air pollution and wastewater treatment systems, and waste disposal system.

     Source of Fund and Management: The Environmental Fund started in 1992 with an initial capital of 5,000 million Baht (US$ 200 million) approved by the government, consisting 500 million Baht (US$ 20 million) from the Revolving Fund for Environmental Development and Quality of Life, and 4,500 million Baht (US$ 180 million) from the Fuel Oil Fund. During 1993-1995, the government subsidised 1,250 million Baht. In 1994, the Japan Bank for International Cooperation also provided loan to the Environmental Fund of 100 million USD. The Office of the Environment Fund is responsible for the management and administration of the Fund and is a division under the Office of Environmental Policy and Planning.

     The Functions of Environmental Fund: The Environmental Act of 1992 allows the Environmental Fund to serve as a financial measure that support grants and loans. The Environmental Fund Committee has stipulated that the preferred method of disbursement from the Environmental Fund is to ensure that the revolving nature of it is maintained at proper ratio. The first priority of support is loan with low interest rate, while a grant may be provided in the case of acute necessity when funds cannot be obtained from other sources.

     Scopes of Activities Supported:

1. Provision of central wastewater treatment system and waste disposal system which belong to the government agency or to the local administration.
   
   
2. Provision of wastewater/air pollution treatment system, waste disposal system or other equipment that are used by the local administration, state enterprise and public organization.
   
   
3. Provision of wastewater/air pollution treatment system, waste disposal system or other equipment, whose sources are of those small and medium-size private entities that have legal responsibility to solve environmental problem, and of those private entities that have no legal responsibility but wish to participate in solving such problem.
   
   
4. The dismantling/relocation of the enterprise to suitable industrial estate or industrial zone equipped with wastewater treatment system or waste disposal system.
   
   
5. The task of service contractor who is permitted by the Act to provide wastewater treatment and waste disposal services.
   
   
6. Activities of the government agency, local administration and NGOs on environment, for the promotion of natural resource and environmental conservation which are participated by the organization of the community and people.
   
   
7. Other activities related to the enhancement and conservation of environmental quality of the government agency and local administration as deemed appropriate by the Environmental Fund Committee.
   
   
8. Express for Environmental Fund management and administration.
   
   

See also: Thailand example: The Oil Fund

Peer Review Committee Good practice rating: (1 for the best, 5 for the lowest score)
Sustainability		Efficiency
2	Improvement in either the environment of economic condition with no harm to the other.	3	Cost efficient.
3	Sustainable over time (not one-off)	Process
Adaptability		3	Participation of the community
2	Location adaptability (can the project be done in other places?)	2	Participation of resource owners/users
2	Socio-cultural adaptability.	2	Partnerships between various actors (Governments, NGO, Academia, Private)
3	Level of development adaptability.	2	Degree of coordination and cooperation between government departments.
3	Style of government adaptability.	2	Ability to attract political interest/support
2	Degree of decentralization adaptability.	-	Procedures for feedback and review.
Comments on this example:      One key element of environmental protection is the application of the economic instruments based on the Polluter Pays Principle (PPP). Environmental Fund is used to subsidize the decentralized environmental management activities.      The financial and economic crisis in Thailand complicates the situation. On one hand, the economic slowdown temporarily reduces the pressure on natural resources and the environment. On the other, it reduces the public's ability to address environmental problems with determination. Thus, the role of the private sector, local administration, state enterprise, public organization and non-governmental organization in environmental management in Thailand is now more vital than ever and the Environmental Fund is one of the policy measure to let them to participate in protecting and conserving environmental quality of the country.      Focus need to be placed on how to promote learning capacity before getting involve with the fund and should be able to review the nature of fund. Sustainability of the project:      Sustainable over time: Sustainability of the project depends on the availability of funds. For this project, sources of finance are revolving fund and fuel oil fund, not the direct government budget so the sustainability depends on the performances and the functions of those two funds. Adaptability of the project to other situations:   Process of decision making and implementation:      Participation and partnership: The Government uses the Environmental Fund as a financial measure to serve on managing natural and environmental resource in line with decentralizing local authority, developing society to be able to manage and conserve their natural resources and environment as well as strengthening public participation in natural and environmental, social and economic development in the future.      Ability to attract political support: This type of projects can often be politically popular as the government pursues the result in short term. Stakeholders such as Communities also welcome them as they are the recipients of the project funds. The risk is that the project is driven by availability of financial resources, rather than the demand from the community. Cost efficiency:      The major constraint for this kind of policy is the lack of fund. To efficiently implement the policies (in term of cost), government may need to examine the outcome of these subsidy schemes.