France seeks slice of Thailand's railway projects

[Lite Beer]

France seeks slice of Thailand's railway projects

The Nation

France is the latest major economic power to become attracted to Thailand's dual-track high-speed railway projects.

Deputy Prime Minister MR Pridiyathorn Devakula told reporters that during a meeting with the French ambassador to Thailand, Thierry Viteau, yesterday he learned that France was interested in investing in the projects.

Earlier, China, Japan and Germany voiced interest in the projects.

Thailand has signed initial agreements with Japan and China for collaboration on the construction of several dual-track railway projects, while this week Germany showed interest in the Bangkok-Hua Hin route.

Pridiyathorn said he told the French ambassador that both the Chinese and Japanese governments had been discussing this project with Thailand for a long while, and that France had never previously voiced any interest.

He said the government had instead asked France to participate in bidding for an operation licence for urban-rail lines, with the auction expected to take place this year, as France had the technology relevant to electric trains.

The deputy prime minister said the government should at this time consider project bids from only those countries it had already signed agreements with, as the military government's tenure was coming to an end.

"It should not open bids for any new projects available, letting the next governments do that," he said.

Pridiyathorn that said if France was still interested in a high-speed-rail project, it would have to discuss the matter with the next government.

He said construction of the routes under the China partnership was expected to start first because China was already studying those projects.

Japan had asked permission to start studying the routes, but had no construction plan yet.

Under the conditions of the memorandum of understanding with China, the economic giant will transfer the construction technology to Thailand to build the routes, with China extending the Kingdom a loan at an interest rate of 2-4 per cent per annum to finance the project. "If we think the lending rate is too high, it's not necessary to borrow. We can raise funds via the infrastructure fund, buoyed by the liquidity in the country," Pridiyathorn said, adding: "Do not be worried too much, as the projects are considered national assets. The key point is who will construct and operate them."

Addressing public concern over a possible lack of transparency in the Thai-China cooperation, Prime Minister General Prayut Chan-o-cha said the deal had yet to be finalised.

He added that if the project were found to be too costly, the country would not develop it.

China and Thailand signed the MoU last December. Construction is expected to commence in 2016 on two standard-gauge parallel railways - the 734-kilometre Nong Khai-Nakhon Ratchasima-Kaeng Khoi-Map Ta Phut Port line and the 133km Kaeng Khoi-Bangkok line.

Prayut said the project was overseen by a number of subcommittees in terms of possible investment, routes and benefits to be gained along the routes.

The government will also monitor the project to ensure transparency, he said.

Source: http://www.nationmultimedia.com/business/France-seeks-slice-of-Thailands-railway-projects-30254100.html

-- The Nation 2015-02-14

[chooka]

What does France have to say about this? All these countries who don't recognise the military government but are willing to throw thier money at them. Let's hear what they have to say and not just this military propaganda.

[NeilSA1]

What does France have to say about this? All these countries who don't recognise the military government but are willing to throw thier money at them. Let's hear what they have to say and not just this military propaganda.

What military propaganda.?

Good, let's hear what France has to say before making further comments.

[tonbridgebrit]

If the French had of won the Vietnam war (there own Vietnam war), Vietnam today would be a French colony, or have a puppet government controlled by France. The French could then use Vietnam as a launch pad to take-over Thailand.
No need then to try and encourage the Thais to give France the contracts for railway lines. Just tell them that France WILL get the contracts.

[rhythmworx]

France won't get a sniff of it.

"China", one word, it doesn't even need explaining.

[Strangebrew]

Doesn't it give you that good feeling all over that the government is going to watch over the project? Sort of like letting the fox watch the hen house.

[DLock]

Thailand is balking at the 4% interest rate China is charging, so that's looking shaky.

Japan is still smarting over that whole "Death Railway" misunderstanding thingy.

Now France wants a piece of the action?

Why? What possible reason could the French want to invest in a railway 10,000km away?

Next, Greece will want to invest.

[ikke]

Thailand is balking at the 4% interest rate China is charging, so that's looking shaky.

Japan is still smarting over that whole "Death Railway" misunderstanding thingy.

Now France wants a piece of the action?

Why? What possible reason could the French want to invest in a railway 10,000km away?

Next, Greece will want to invest.

France has the longest experience in the world about HST (TGV) all other did learn from them, so France would be a reliable partner.

[Rancid]

If France decides it doesn't like the government do they then cancel the contract? Russia's ships come to mind as a less than reliable supplier.

[roquefort]

Because it's good business.

France has the best railway system in Europe (try taking a TGV - on time, fast, comfortable and cheap). They have the technology and need to recoup their R&D investment by selling it to other countries. Simples.

[DLock]

Because it's good business.

France has the best railway system in Europe (try taking a TGV - on time, fast, comfortable and cheap). They have the technology and need to recoup their R&D investment by selling it to other countries. Simples.

Fair point.

But I don't understand the word "investing".

"Selling" would make more sense...but why would France "invest" in Thailand railways?

[Baerboxer]

If France decides it doesn't like the government do they then cancel the contract? Russia's ships come to mind as a less than reliable supplier.

France only suspended delivery of the warships to Russia under immense pressure from its EU partners.

Comparing the situation here to Russia and the Ukrainian insurgency is ludicrous.

The EU can say what it likes. France and Germany are interested. France has a basket case economy at the moment and will do what's necessary. Germany is already collaborating closely with Thailand on some key initiatives.

The EU is full of double talk and hypocrisy.

[Baerboxer]

Because it's good business.

France has the best railway system in Europe (try taking a TGV - on time, fast, comfortable and cheap). They have the technology and need to recoup their R&D investment by selling it to other countries. Simples.

Fair point.

But I don't understand the word "investing".

"Selling" would make more sense...but why would France "invest" in Thailand railways?

I guess any deal will involve supply, install, commission and maybe operate. These deals are often not just straight forward sales contracts. Some of the reward comes through joint operations, profit shares over a fixed number of years etc. In that sense the supplier, key contractor, becomes an investor.

[rickirs]

Because it's good business.

France has the best railway system in Europe (try taking a TGV - on time, fast, comfortable and cheap). They have the technology and need to recoup their R&D investment by selling it to other countries. Simples.

Fair point.

But I don't understand the word "investing".

"Selling" would make more sense...but why would France "invest" in Thailand railways?

Investment by a nation is done to increase GDP and GDP growth rate. I expect France and Japan would do the same deal as China which is to loan the Thai government 80%+ of the total project costs that gives it 80% equity (aka investment) ownership in the project. That ownership is then bought back by Thailand over say 20 years with a return on capital in the form of debt service. China is asking 2-4% interest on debt that is higher than Thi treasury bonds. That debt service is paid through project revenues.

Thailand essentially gets no GDP growth from the project for the term of the payback. Good for the foreign countries, questionable for Thailand. whose economic has stagnated at best.

[harryfrompattaya]

What does France have to say about this? All these countries who don't recognise the military government but are willing to throw thier money at them. Let's hear what they have to say and not just this military propaganda.

I think you miss the point they the French will send their Moslems to work on the railroad

[Paulc01]

Sorry, Frenchies, the fix is already in, and YOU are OUT.

[Yme]

"Addressing public concern over a possible lack of transparency in the Thai-China cooperation, Prime Minister General Prayut Chan-o-cha said the deal had yet to be finalised.

He added that if the project were found to be too costly, the country would not develop it."

First signs the project might not go ahead? That would be embarrassing

[MrPerfect]

The Junta are out of their league here getting played by the gorillas of the world economy. The rice scheme is going to be remembered as a stroke of genius when measured against the debacle of the Juntas rail scheme. Pity the Thai tax payers and consumers who are getting stitched up for generations of debt by inept unelected clowns.