Thailand Promotes Major Infrastructure Projects for 2021
In a recent foreign press conference, Deputy Secretary-General Kobsak Pootrakool and Secretary of Thailand’s Council of Economic Ministers said that the kingdom’s economic growth in the next five years would be based on and derived from its present and substantial infrastructure investment. He pointed to present global economic recurring downtrends and geopolitical and commercial unrests as visibly affecting Thailand’s economic growth in less than five years He, however, expressed confidence that the foundations for sustaining the economy and containing the negative impact of fluctuations had been set up in order. His confidence rested on policies that would buffer the local economy, small and medium businesses, agriculture, and competitive capabilities of exports and tourism. These further included expediting public disbursement and conducting private investment.
Specifically, in infrastructure, the government’s major projects would approve up to 2,000 kilometers of double track trains, a high-speed railroad connected to three airports, a bigger airport capacity, and the massive expansion of the transportation system. In all other sectors, the Deputy Secretary-General said that this would be the best time for businesses to invest in the kingdom.
Joint Ventures with EEC
Signed in May last year, this cooperative measure covers four infrastructure projects earlier mentioned and has the potential of transforming Thailand into a foremost commercial Asian center. The meeting between the EEC Policy Committee and Prime Minister General Prayut Chan-o-cha concluded with this prospect.
- The High-Speed Rail Linking Three Airports – The Committee approved the proposal submitted by the Charoen Pokphand Holdings or CPH in late January last year. The State Railway of Thailand prepared the joint venture agreement for the Attorney-General and the EEC and which was forwarded to the Cabinet. The agreement was signed in May last year.
- The U-Tapao Airport and Eastern Aviation City Development Project – as part of its overall plan for the Eastern Airport City, the Thai government hopes that this international airport would attract investors to the kingdom. Industry Minister Uttama Savanayana considered this project a key element of Thailand’s Eastern Economic Corridor or EEC. The facilities cover 570 rai.
- The Map Ta Phut Industrial Port Development Project – Phase 23 is a joint venture between the Gulf and PTT Tank of the private sector. This industrial port is high-capacity and replete with a broad range of facilities and services for its patrons. It is also strategically located for their convenience. At present, this structure is the largest of its kind in Thailand. Multi-racial guests can be sure to receive equal treatment and provision of world-class services and facilities. This industrial port is considered Thailand’s “golden gateway” that shows the world how extensively Thailand has industrialized.
The Thai government is confident that these four ambitious projects would entice large cash flows into the kingdom. The transport project, in particular, promises to provide the much-needed and long-dreamed links to all sectors. Moreover, the government views all four infrastructure projects to transform Thailand into an investors’ commercial hub in Asia.
The EEC, the Infrastructure Projects and Thailand’s Growth
The Thai government passed the law for trade and investment development in creating the Eastern Economic Corridor or EEC on February 1, 2018. It is also now called the Eastern Special Economic Development Zone. Such a move was to induce the development of its eastern provinces into bustling major economic locations. The EEC covers Thailand’s Eastern provinces of Chonburi, Rayong, and Chachoengsao off the gulf. The zone has a total land area of 13,285 square kilometers that the government intends to completely develop by next year. The goal is to transform them into a center for technological manufacturing and services. It is envisioned to link with neighboring ASEANs by all transport means of air, sea, and land. The Board of Investment reported that, as of January 1, 2018, the Corridor had earned US9.3 billion in committed foreign direct investments or FDIs.
The bold expectation is an income of 43 billion USD or 1.5 trillion Thai Baht in realizing these goals with EEC in the next three more years. The income is expected from state funds, public and private partnerships or PPPs, and FDIs. The four core areas the government finds necessary to promote the attractiveness of the EEC are:
- More and better infrastructure
- Centers for enterprise, industrial clusters, and innovations
- Tourism, and
- New cities created by sophisticated urban planning methods
Through the EEC, the Thai government foresees 100,000 new jobs in the manufacturing and service industries this present year alone.
Development Projects on the Drawing Board
The government listed 15 major investment projects for EEC, a few of which are follow-ups on already existing infrastructure projects discussed earlier. These are:
- U-Tapao airport and aircraft maintenance
- Development of the Sattahip commercial seaport
- Further development of Laem Chabang por
- Further development of Map Ta Phut port
- Installation of double-track railways in and through the Eastern provinces
- Expansion of present highways and motorways
- Creation and introduction of new or next-generation automotives fueled by batteries and electricity
- Creation and introduction of aviation, industry and lifestyle robotics as well as ingenious electronics
- Introduction of advanced petrochemicals and bio-economics
- Transformation of Eastern provinces into medical centers
- Promotion of tourism in the Eastern provinces
- Developing these Eastern provinces into global business centers
- The creation of new cities to accommodate increased populations in the Eastern provinces with special attention on inclusive growth and efficient public utilities
The Thai government is also contemplating on building a digital park in Si Racha on the Chonburi coast as support for the development of the EEC’s innovations. It is aimed at complementing the digital connectivity, which is a high priority.
Clear Economic Diversification
These projects and further plans are clear steps of veering away from dependency on the country’s traditional garment and agriculture industries. Its zeal in expanding its urban centers is strongly indicated by efforts expended to develop advanced skills training for the workforce. The creation and operation of the first major infrastructure projects already signify the direction that Thailand is definitely taking. With these projects and overall local expansion, Thailand’s EEC zone is more and more assuring its transformation into a leading ASEAN investment and business core.
Category: Business in Thailand
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