Sino-Thai railway project can wait until terms are right

[webfact]

BURNING ISSUE
Sino-Thai railway project can wait until terms are right
SASITHORN ONGDEE

BANGKOK: -- DO THAIS really need to rush to build a medium-speed railway on the northeastern route? The answer is obviously no.

So, it was not surprising when there were reports over the past few days that the rail cooperation between the Thai and Chinese governments might be put on hold because China's rubber purchase deal from Thailand had not gone as planned.

The Sino-Thai railway project was planned to feature 873km dual tracks with a 1.435-metre gauge carrying trains at a speed of up to 180 km/hour. The line was to link Laem Chabang in Chon Buri province with Nong Khai, a province in the Northeast bordering Laos via Nakhon Ratchasima, Kaeng Khoi in Sara Buri province and Map Ta Phut and Bangkok with Kaeng Khoi.

The Sino-Thai railway development project has been on the table of the two nations for many years, going back to time of the Chuan Leekpai government in 1992, but it has never made much progress.

Under Prime Minister Prayut Chan-o-cha's ministration, the talks on railway cooperation were resumed and that revived Thai dreams of a concrete high-speed railway though the speed would have been in the range of 160 to 180kph.

The critical issues in the negotiations involved interest rate on soft loans that China would provide for the project and the engineering works on some sections of the route, as China reportedly wanted to cut through the mountains.

Thailand sought an interest rate of 2 per cent per annum on the soft loans while China insisted on 2.5 per cent, arguing that Thailand was now an upper-middle income country.

According to a state agency study, the internal rate of return on the project is not much. It suggests that only if the rail line passes through Laos and links up with the southern part of China, where the economy is sizeable with a fast-growing trend, would it be worth making the investment.

We can guess who will reap the most benefits from the railway project?

It is important that China offer more assistance to Thailand in the same way it provides for Laos.

In the meantime, the Thai government is playing another card, turning to Japan for rail cooperation instead, rather than grasping at nothing. This is because the government has banked on the railway investment to boost the economy next year.

It would indeed be strange if the Sino-Thai railway project ends up on shelf, because then it would not make it to the fiscal 2016 budget's transport development plan worth Bt1.79 trillion approved by the Cabinet meeting on Tuesday.

The rail cooperation between Thailand and Japan could overtake the Sino-Thai railway project. Both countries will jointly invest in improving the single-track railway from Kanchanaburi, a border province in the West, to link up with Sa Kaeo in Aranyaprathet located on the east side and upgrading it to become a double-track railway.

After that they will jointly invest in an extension of the rail line from Kanchanaburi to Phu Nam Ron and from Sa Kaeo to Khlong Luek to link up with Myanmar and Cambodia, respectively.

The rail line as located along the Lower East-West Economic Corridor is likely in favour of Japan's production bases and its supply chains.

Thailand, however, has its own railway running from Bangkok to the Northeast, and though it features a single track with a metre gauge, it is under improvement to meet the safety standards to become a dual-track railway.

If there is no Sino-Thai railway project, Thailand will lose nothing except for a slide in land prices that have been skyrocketing in anticipation of the project and a slowdown in the economies driven by urbanisation.

There is no urgent need for the country to have a different railway track, especially one requiring a huge investment that could balloon to Bt500 billion from Bt400 billion previously estimated, if we do not get a good deal.

Source: http://www.nationmultimedia.com/politics/Sino-Thai-railway-project-can-wait-until-terms-are-30274293.html


-- The Nation 2015-12-04

[Ricardo]

I think it's correct to believe that since the majority of the economic benefit from this major regional-project will accrue to China, they should also be paying for the bulk of the cost, of building that part of their line which lies inside Thailand.

A hardline view IMO might be, that the Chinese government should pay the full cost, with Thailand merely contributing the necessary SRT/state-owned land, in return for the extra volume which will be shipped through Thai ports.

However Thailand hopes for some exports to move northwards to China (or perhaps just to Laos ?), its agricultural produce for example, or some of the output of its industrial-estates on the Eastern Seaboard.

And there is also the opportunity to run limited passenger-services to the north-east, along the new line, and it seems reasonable to expect Thailand to pay for the associated stations or rolling-stock, in return for the major improvement to domestic transport which this would represent. TANSTAAFL.

But a deal where Thailand bore all the risk, when it can't control how much freight the Chinese will want or need to send down the line to Laem Chabang, would be a bad investment, because the domestic benefits of the project are insufficient to pay for the full costs.The costs need to follow the economic-benefits, in a regional-infrastructure project like this one.

Let's hope that, whichever governments finaly negotiate or complete the eventual deal, the cost to Thailand is more-than-covered by the economic-benefits to the country, if not they should indeed steer clear of it !

The more-limited already-underway-but-much-delayed SRT track-doubling scheme is less-expensive, but the benefits are clearly mostly for Thailand, the country which is paying for it.

Which is as it should be, Thailand has no need or reason, to subsidise or bear the full risk of a major Chinese-led project, just because part of it happens to run across Thailand.

In a more-ideal world, a regional-project like this one might have been devised/developed/funded by an international government-owned body, and the hoped-for eventual benefits passed to the various governments in proportion to their involvement. That might be less-expensive & less-risky for Thailand.

[steven100]

The deal will benefit China around 90% and Thailand only 10% due to exports. China knows it has a win if it goes ahead but China will not budge an inch on cost or negotiations over the project.

Thailand ought to know how tough China can be when it comes to JV agreements and therefore be prepared.

I think the rail link will be good for Thailand but at what cost ......... !!

[Ricardo]

Just to add that the Thai economy should also benefit as well, from the short-term boost while the link is being built, and from having extra volume through Laem Chabang port, running the link should also add jobs for Thais.

[chainarong]

A proper way of doing this rail project would be to keep Prayut - O out of it altogether , planning for the project should take 5 years not 3 months, allocation of cold hard cash is the only course, this bartering is medieval and so out of date it was last done when King Arthur did a deal on that round table, projects of this size need professional guidance, experts in the field of rail systems not some blabbered shouting of at the mouth about something he clearly has no knowledge about , having spent 12 years on the footplate and still retain an interest in rail, I can safely say I still can find dynamic brake selection or for Prayut- O benefit reverse......................

[Ricardo]

The current administration is merely the latest one to try to cope with this 'opportunity', and will I suspect be long-gone, when the first end-to-end freight-trains start rolling.

But the OP is correct to see that this negotiation with China could go quite badly, if Thailand fails to keep its own economic-interests firmly in mind, this is playing with the big boys and the threat to take one's cricket-bat home is an essential part of it.

The recent threat by China to change the deal on the related rubber-purchase is a reminder that two can play the game. BUT I'd bet on them, rather than a transitory local politician, if I had to.

[Tom Cahill]

The deal will benefit China around 90% and Thailand only 10% due to exports. China knows it has a win if it goes ahead but China will not budge an inch on cost or negotiations over the project.

Thailand ought to know how tough China can be when it comes to JV agreements and therefore be prepared.

I think the rail link will be good for Thailand but at what cost ......... !!

I speak with experience of this railway project, as a contract manager. The railway's already going to be built in terms of the big hitter's plans. It's inevitable. The Chinese need it to be built. What the stalling is is bribery isn't that easy and working out who will benefit from the state funding personally. Don't think it's not going to be built because that's cloud cookoo land stuff.

Another thing to take on board is this. MC Germuda's a Chinese company and they'll actually do the majority of the work as they did in Malaysia, or, failing that, someone like them. Then, they use their contractors to do the subcontract work. A lot more money will go back to China or at least be in Chinese hands than people not acquainted with how this works understand.

There's a length of track IN THAILAND which has been built, which connects to the double track in Malaysia and goes all the way to Kuala Lumpur as well as other additional locations which are all happening now. It's built and it's all double track in one meter gauge and it's electrified with overhead cables to replace diesel.

The whole thing sounds like a good idea, but the UN's Agenda 21 insisting on electrification's not for the good of Humanity, and my understanding is that in many ways the efforts on this project already completed are largely comparative to a downgrade as the signals and comms have been swapped from expensive state of the art, European ones, for s*itty Chinese parts---China gaining again. The British government's involved and giving cover for this via their Chamber of Commerce, who's Chair in Malaysia's responsible for a lot of the corruption, and a massive beneficiary.

Further to this. I speak with experience when I say that the taxation payable, and the overpayments which are prevelant, are all involving Chinese businesses and they just bribe the banks and the police, the immigration, the exchequer, the anit-corruption people and anyone else who's in the way; or, they use the police to intimidate them or take care of them.

I speak as a first hand witness to all of this and was in a position to have a very in depth insight of how it's run and how it will run in Thailand when it gets going, unless serious efforts are made to stop all the skimming. I can give substantive data and police reports to anyone who's interested. I've been pushing for this to be stopped, but it's difficult as everyone's paid off. I needed to trick the police into taking the report so none the less, is now on the system. It was Friday, they wanted to go home, they wouldn't take the typed report as it was damning, so they took a handwritten report, telling me not to put in the parts which were criminal, then they phoned the firm to try and get them down to intimidate me but they'd already failed at this (including one of them bursting out in tears as he thinks he's going to prison), so I 'helped' the old boy who was typing it up when he offered me the chance to check his spelling. I changed the report and left his spelling. He signed it and it's there on the record. If you'll notice, the numerated points start again. Those ones at the start were added by me in a frenzy of typing. The other stuff's not really a big deal and they could uninvesitgate that without any issues.

http://www.scribd.com/doc/243191444/14-03-28-Balfour-Beatty-BBASJV-Police-Report-Fraud

More related documents there as well, and more to follow shortly.

BBAS Corruption: wholesale rape of BBplc's ... - YouTube

▶ 55:20

https://www.youtube.com/watch?v=4L4eftMqM8k

BBAS Corruption: "it's our policy...we delete all ... - YouTube

▶ 10:46

https://www.youtube.com/watch?v=XjBlWSltKM0

[Srikcir]

If there is no Sino-Thai railway project, the Prayut regime LOSES FACE over Prayut's promises to improve the economy with this dual rail project. Prayut is compelled to have the deal go forward. That was not the case with either the Abhisit or Yingluck regimes who also considered the same project but as a joint venture.

Once enough backdoor side deals are made by the Prayut regime with China to give it enough concessions to compensate for a change in financial terms, the project will go forward.

[ratcatcher]

The deal will benefit China around 90% and Thailand only 10% due to exports. China knows it has a win if it goes ahead but China will not budge an inch on cost or negotiations over the project.

Thailand ought to know how tough China can be when it comes to JV agreements and therefore be prepared.

I think the rail link will be good for Thailand but at what cost ......... !!

I speak with experience of this railway project, as a contract manager. The railway's already going to be built in terms of the big hitter's plans. It's inevitable. The Chinese need it to be built. What the stalling is is bribery isn't that easy and working out who will benefit from the state funding personally. Don't think it's not going to be built because that's cloud cookoo land stuff.

Another thing to take on board is this. MC Germuda's a Chinese company and they'll actually do the majority of the work as they did in Malaysia, or, failing that, someone like them. Then, they use their contractors to do the subcontract work. A lot more money will go back to China or at least be in Chinese hands than people not acquainted with how this works understand.

There's a length of track IN THAILAND which has been built, which connects to the double track in Malaysia and goes all the way to Kuala Lumpur as well as other additional locations which are all happening now. It's built and it's all double track in one meter gauge and it's electrified with overhead cables to replace diesel.

The whole thing sounds like a good idea, but the UN's Agenda 21 insisting on electrification's not for the good of Humanity, and my understanding is that in many ways the efforts on this project already completed are largely comparative to a downgrade as the signals and comms have been swapped from expensive state of the art, European ones, for s*itty Chinese parts---China gaining again. The British government's involved and giving cover for this via their Chamber of Commerce, who's Chair in Malaysia's responsible for a lot of the corruption, and a massive beneficiary.

Further to this. I speak with experience when I say that the taxation payable, and the overpayments which are prevelant, are all involving Chinese businesses and they just bribe the banks and the police, the immigration, the exchequer, the anit-corruption people and anyone else who's in the way; or, they use the police to intimidate them or take care of them.

I speak as a first hand witness to all of this and was in a position to have a very in depth insight of how it's run and how it will run in Thailand when it gets going, unless serious efforts are made to stop all the skimming. I can give substantive data and police reports to anyone who's interested. I've been pushing for this to be stopped, but it's difficult as everyone's paid off. I needed to trick the police into taking the report so none the less, is now on the system. It was Friday, they wanted to go home, they wouldn't take the typed report as it was damning, so they took a handwritten report, telling me not to put in the parts which were criminal, then they phoned the firm to try and get them down to intimidate me but they'd already failed at this (including one of them bursting out in tears as he thinks he's going to prison), so I 'helped' the old boy who was typing it up when he offered me the chance to check his spelling. I changed the report and left his spelling. He signed it and it's there on the record. If you'll notice, the numerated points start again. Those ones at the start were added by me in a frenzy of typing. The other stuff's not really a big deal and they could uninvesitgate that without any issues.

http://www.scribd.com/doc/243191444/14-03-28-Balfour-Beatty-BBASJV-Police-Report-Fraud

More related documents there as well, and more to follow shortly.

BBAS Corruption: wholesale rape of BBplc's ... - YouTube

▶ 55:20

https://www.youtube.com/watch?v=4L4eftMqM8k

BBAS Corruption: "it's our policy...we delete all ... - YouTube

▶ 10:46

https://www.youtube.com/watch?v=XjBlWSltKM0

"There's a length of track IN THAILAND which has been built, which connects to the double track in Malaysia and goes all the way to Kuala Lumpur as well as other additional locations which are all happening now. It's built and it's all double track in one meter gauge and it's electrified with overhead cables to replace diesel."

As a person "experienced " on this rail project, can you enlighten us as to where and how the electrified one metre gauge system in Thailand" which connects to the KTM (in Malaysia), will connect with the standard gauge system being proposed by China.

We know that this track will run from Nong Khai to Laem Chabang via Kaeng Khoi Jct, Saraburi", but where will the two gauges meet. If at all.

Isn't it strange that the Thai government is planning a Chinese financed standard gauge railway on one hand while at the same time spending billions of baht double tracking an existing metre gauge system.

[chainarong]

The deal will benefit China around 90% and Thailand only 10% due to exports. China knows it has a win if it goes ahead but China will not budge an inch on cost or negotiations over the project.

Thailand ought to know how tough China can be when it comes to JV agreements and therefore be prepared.

I think the rail link will be good for Thailand but at what cost ......... !!

I speak with experience of this railway project, as a contract manager. The railway's already going to be built in terms of the big hitter's plans. It's inevitable. The Chinese need it to be built. What the stalling is is bribery isn't that easy and working out who will benefit from the state funding personally. Don't think it's not going to be built because that's cloud cookoo land stuff.

Another thing to take on board is this. MC Germuda's a Chinese company and they'll actually do the majority of the work as they did in Malaysia, or, failing that, someone like them. Then, they use their contractors to do the subcontract work. A lot more money will go back to China or at least be in Chinese hands than people not acquainted with how this works understand.

There's a length of track IN THAILAND which has been built, which connects to the double track in Malaysia and goes all the way to Kuala Lumpur as well as other additional locations which are all happening now. It's built and it's all double track in one meter gauge and it's electrified with overhead cables to replace diesel.

The whole thing sounds like a good idea, but the UN's Agenda 21 insisting on electrification's not for the good of Humanity, and my understanding is that in many ways the efforts on this project already completed are largely comparative to a downgrade as the signals and comms have been swapped from expensive state of the art, European ones, for s*itty Chinese parts---China gaining again. The British government's involved and giving cover for this via their Chamber of Commerce, who's Chair in Malaysia's responsible for a lot of the corruption, and a massive beneficiary.

Further to this. I speak with experience when I say that the taxation payable, and the overpayments which are prevelant, are all involving Chinese businesses and they just bribe the banks and the police, the immigration, the exchequer, the anit-corruption people and anyone else who's in the way; or, they use the police to intimidate them or take care of them.

I speak as a first hand witness to all of this and was in a position to have a very in depth insight of how it's run and how it will run in Thailand when it gets going, unless serious efforts are made to stop all the skimming. I can give substantive data and police reports to anyone who's interested. I've been pushing for this to be stopped, but it's difficult as everyone's paid off. I needed to trick the police into taking the report so none the less, is now on the system. It was Friday, they wanted to go home, they wouldn't take the typed report as it was damning, so they took a handwritten report, telling me not to put in the parts which were criminal, then they phoned the firm to try and get them down to intimidate me but they'd already failed at this (including one of them bursting out in tears as he thinks he's going to prison), so I 'helped' the old boy who was typing it up when he offered me the chance to check his spelling. I changed the report and left his spelling. He signed it and it's there on the record. If you'll notice, the numerated points start again. Those ones at the start were added by me in a frenzy of typing. The other stuff's not really a big deal and they could uninvesitgate that without any issues.

http://www.scribd.com/doc/243191444/14-03-28-Balfour-Beatty-BBASJV-Police-Report-Fraud

More related documents there as well, and more to follow shortly.

BBAS Corruption: wholesale rape of BBplc's ... - YouTube

▶ 55:20

https://www.youtube.com/watch?v=4L4eftMqM8k

BBAS Corruption: "it's our policy...we delete all ... - YouTube

▶ 10:46

https://www.youtube.com/watch?v=XjBlWSltKM0

Remarks noted Tom, chainarong

[hansnl]

China wants the railway because it is a strategic wish of the Chinese military.

Thailand would be better off to invest in the existing 1 metre lines.

Double the tracks, new lines, electrification, rolling stock.

All this will be much cheaper for the taxpayers, and ultimately for users of the trains, freight or passenger.