Thailand to launch big infra projects for economic integration

Bangkok (The Nation/ANN) - A modal shift in transport for greater competitiveness is the name of the game behind the government's massive infrastructure development programme, which will be kicked off this year with the tendering of four high-speed-rail projects.

Under the grand plan, 55 projects worth Bt2.27 trillion (US$66.29 billion) are to be completed by 2020.

These projects are part of the government's long-term development plan but are being expedited by a commitment to infrastructure investment, the opening up of Myanmar, and the implementation of the Asean Economic Community (AEC).

The Finance Ministry is expected to submit a draft Bt2.2-trillion borrowing bill for the Cabinet's approval this month.

In the 2013 fiscal year, infrastructure spending of Bt100 billion is earmarked, according to Transport Minister Chadchart Sittipunt.

"The infrastructure development projects are designed to make Thailand the true centre stage of Asean. Under this plan, Bangkok will no longer singly represent Thailand. Major cities will gain greater prominence, thanks to the AEC, which will allow us to expand our territory without having to go to war, and extend regional connectivity," the minister said in an interview.

Of the total budget of Bt2.2 trillion, 64 per cent will fund 31 rail-related projects, 24 per cent will go to 13 road projects, 7 per cent to seven water-transport projects, and 4.75 per cent to four air-transport projects.

Ultimately, these projects are expected to improve linkages between Thailand and its Asean neighbours, reduce logistics costs, deal with growing traffic congestion, and boost tourism revenue.

Chadchart envisages Thailand as the centre of Asean through its presence in the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (Bimstec), the Greater Mekong Subregion (GMS), the Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACEMECS), and the Indonesia-Malaysia-Thailand Growth Triangle.

To benefit fully from these connections, Thailand requires a new seamless network and new rules to facilitate cross-border transport.

Thailand will be linked with the regional groups through the Southern Economic Corridor (Bangkok-Phnom Penh-Ho Chi Minh City), the East-West Economic Corridor (Malamang-Phitsanulok-Khon Kaen-Savannakhet-Danang), and the North-South Economic Corridor (which links Thailand with Kunming, China, via Laos and Myanmar). Through Route R9, Thailand will link Vietnam, Cambodia and Myanmar.

The road links are expected to boost border trade, which totalled $22.7 billion in the first nine months of 2012.

"We need to be friends with all our neighbours and must not take advantage of them. This can be a win-win deal for all sides," Chadchart said.

New investments in rail projects are designed to reduce logistics costs, which now account for 15.2 per cent of gross domestic product, against 8.3 per cent in the United States.

The cost is high as freight transport is 86 per cent by road, though this mode is the most polluting and most dangerous to life.

From 71 billion kilotonnes equivalent of carbon emission in 2010, 35 per cent came from goods transport and 36 per cent from the manufacturing sector.

Shipment by rail and water, currently at 12 per cent and 2 per cent respectively, will be promoted because of their lower costs compared to road transport.

"Rail transport should be tentatively raised to 40 per cent," Chadchart said.

Costing a total of Bt900 billion, the four high-speed-rail routes will help the government achieve that goal.

While the high-speed trains will speed up travel for individual commuters, they will also promise a shorter transport period for goods.

In Bangkok, where new roads cannot be built, the combined length of the electric-train routes will be expanded by 10 times from 40 kilometres to 468.8km. Tendering of the MRT Pink Line is expected to take place next month.

"If the tendering of all 10 new projects can be launched within two years, they will all be completed seven years from now," he said.

In the air-transport segment, some airports will be improved to attract more tourism revenue.

"There are 38 airports in Thailand, but 72 per cent of tourist arrivals are seen through Suvarnabhumi Airport," Chadchart said.

"The bottleneck must be tackled. In this regard, the Mae Sot airport could be used for travel to Myanmar."

He said there was plenty of fiscal room to finance the projects.

"We can issue 3-per-cent bonds to finance the infrastructure projects.

"This is worthwhile as it will reduce energy consumption, pollution and logistics costs. We can invest first and pay back the investment through profits reaped from the projects," he said.

The government tentatively plans to finance 8 per cent of the needed funds through revenue of involved state enterprises, 69 per cent through borrowing by government and state enterprises, 9 per cent through annual fiscal budgets, and 14 per cent through public-private investment.

Unlike the Bt350-billion budget for the water-management scheme, which is backed by a borrowing decree, the minister said it was necessary for the government issue a law to back the Bt2.27-trillion transport-infrastructure investment.

"We need a law as we want to make it a national agenda, turning the projects into contingency plans that will bind all [subsequent] governments to follow through. It's a necessity for the nation. Whoever becomes the government must continue with it, as it will benefit the entire country."

To Chadchart, dealing with environmental concerns is key to the success of the scheme. Without public acceptance, the projects could face delays.

As much of the investment will go to rail projects, the government also needs to make sure that the State Railway of Thailand is capable of handling the projects.

He said the new SRT governor Prapat Chongsanguan and the labour union had started to see the urgency of restructuring, as few want to take a train ride because of poor service.

  • Custom faux-tique electric tram aims to replace New York's horses over the neigh-sayers 35 minutes ago
    Custom faux-tique electric tram aims to replace New York's horses over the neigh-sayers

    For the record, it's the year 2014. I mention that in case someone reading this story about a push to replace horses with motorized carriages thinks they've stumbled onto some archival piece by accident. It's been more than 100 years since the first vehicles began to trundle around Manhattan, but the last remaining vestiges of horse-powered transport in the city could be nigh — if the backers of a massive electric wagon get their way.

  • Can home remedies cure jock itch and athlete’s foot? 3 hours ago
    Can home remedies cure jock itch and athlete’s foot?

    Contrary to its name, a ringworm infection is not caused by a worm but by a fungus. It can be contagious and is often characterised by a red circular rash with clearer skin in the middle. Offering tips about what … Continue reading →

  • 2015 Acura TLX blends two sedans into one alphabet soup 5 hours ago
    2015 Acura TLX blends two sedans into one alphabet soup

    Nearly three decades have passed since Honda gave us the car we didn’t know we wanted: a fancified Accord called the Legend, which Honda sold under a newly created luxury brand called Acura. Acura, along with the Lexus and Infiniti brands that followed, proceeded to turn the luxury market on its nose. But since then, everyone from Hyundai to Bentley has stepped up its luxury game while Acura got a bit lost in ubiquity with a cadre of similar-looking products, all with confusing alphabet soup names like ILX, TSX, TL and RLX.

  • ‘Huge’ Hindu, Buddhist statues against Islam, ex-judge says
    ‘Huge’ Hindu, Buddhist statues against Islam, ex-judge says

    KUALA LUMPUR, April 16 — The “huge” statues at a Hindu temple in Batu Caves and Buddhist temple in Penang are an affront to Islam as the religion forbids idolatry, a retired Court of Appeals judge...

  • Singaporeans slam NEA's $120 licence requirement for tissue sellers
    Singaporeans slam NEA's $120 licence requirement for tissue sellers

    Singaporeans on social media reacted angrily to news that tissue sellers at hawker centres and street corners are being required to pay for an annual licence.

  • Over 280 missing after South Korean ferry capsizes
    Over 280 missing after South Korean ferry capsizes

    By Narae Kim JINDO South Korea (Reuters) - More than 280 people, many of them students from the same high school, were missing after a ferry capsized off South Korea on Wednesday, in what could be the country's biggest maritime disaster in over 20 years. It was not immediately clear why the Sewol ferry listed heavily on to its side and capsized in apparently calm conditions off South Korea's southwest coast, but some survivors spoke of a loud noise prior to the disaster.