Thailand approves US$5.2b for delayed China rail project

Thailand approves US$5.2b for delayed China rail project

Bangkok skyline
Skyline of Bangkok, Thailand. (AFP Photo/Nicolas Asfouri)

BANGKOK: Thailand's military government on Tuesday (Jul 11) approved US$5.2 billion to build the first stretch of a high-speed railway that will ultimately link Bangkok to southern China, a massive joint infrastructure project with Beijing that has been dogged by delays.

The project is part of China's huge regional infrastructure plan to build a high-speed rail network connecting the southern city of Kunming with Laos, Thailand, Malaysia and Singapore.

Construction has already begun in Laos but the Thai segment of rail has been stymied for years by tussles over financing, loan terms and protective labour regulations in the Southeast Asian kingdom.

The funding approval from Thailand's cabinet came after military chief Prayut Chan-O-Cha invoked his absolute powers last month to clear a series of legal and technical hurdles standing in the way of the deal.

"The Cabinet has approved phase one of the high speed railway... from Bangkok to Korat with 179 billion baht (US$5.2 billion) budget for a four-year plan," said Kobsak Pootrakool from the Prime Minister's office.

The first stage of the high-speed line will run 250km between Bangkok and the northeastern province of Nakhon Ratchasima, also known as Korat.

The plan is to then extend the track to Nong Khai on the border with Laos.

Thailand will cover the construction costs but the vast majority of technical expertise will come from Chinese engineers - something that has disgruntled local firms who were angered by Prayut's decision to loosen restrictions placed on foreign engineers.

"Thailand will be responsible for the construction, while China will be responsible for design," Thai Transport Minister Arkhom Termpittayapaisith said Tuesday.

The rail deal is one of the biggest foreign investment projects in Thailand in years and is part of Beijing's 'One Belt, One Road' infrastructure drive which aims to revive ancient Silk Road trading routes.

China's largesse and increased investment presence in Asia comes as rival power the United States becomes more isolationist under President Donald Trump.

Thailand's military government has cosied up to Beijing since its 2014 power grab, shelling out billions on Chinese arms and welcoming investment from the regional superpower.

Source: AFP/ek