Article 44 to be used to spur high-speed rail project

[webfact]

Article 44 to be used to spur high-speed rail project
By The Nation

 

 

BANGKOK: -- PRIME Minister Prayut Chan-o-cha is expected to issue a sweeping order under Article 44 of the interim charter to grant multiple legal exemptions to the Thai-Chinese high-speed rail project, which has been delayed for almost two years.

 

Government spokesman Sansern Kaewkamnerd said Chinese engineers and architects will be allowed to work in Thailand for the project, bypassing existing regulations which require them to take local tests to qualify for the work.

 

Sansern said Chinese personnel in this field are regarded as highly experienced personnel with a record of building more than 20,000 kilometres of high-speed rail tracks in China.

 

 

He said that since the rail project is a specific government-to-government deal, it would be exempt from certain requirements in the state procurement law on bidding.

 

As well, a standard pricing method will be used instead of the median price for procurement to facilitate the signing of contracts with Chinese counterparts later this year.

 

And as parts of the Bangkok-Nakhon Ratchasima route will go through forest reserve areas, special permission will be given so that the project can go ahead.

 

A transitory provision in the new Constitution, in effect since April 6, retains Prayut’s powers in his capacity as head of the National Council for Peace and Order, as stated in the post-coup interim charter.

 

 Sansern said exemptions granted to the Thai-Chinese rail project will also apply to other similar and comparable transport schemes, as well as those in  energy and other sectors.

 

Transport Minister Arkhom Termpitayapaisit said legal resolutions were needed for the Bt179-billion project to go ahead as it was not possible to sign contracts with China under existing regulations.

 

Arkhom said deputy premier Wissanu Krea-ngam would prepare details of the legal exemptions to facilitate the project.

 

Sources said Chinese officials were not happy about the project’s delay so the Thai side needed to remove legal obstacles hindering the project.

 

One major problem is that the Thai procurement law requires competitive bidding in state procurement. Unless exemptions are granted, contracts cannot be signed by the two countries.

 

At this stage, it looks likely that the Chinese government will assign state enterprises to enter into contracts with their Thai counterparts.

 

Initially, the Thai government plans to build a 3.5-km line in the Bangkok-Nakhon Ratchasima-Nong Khai route later this year. 

 

Under the implementation schedule, a detailed design contract of the first section has to be signed next month, while a construction contract will be signed in August. 

 

Previously, Thai engineering and architect groups voiced opposition to the plan to exempt Chinese personnel to work here without having to qualify for their work permits. 

 

In fact, the project’s economic viability remains unclear despite investment of nearly Bt200 billion. The interest rates charged on loans for the project are also relatively high, compared to other similar projects.

 

Overall, the Chinese aim to connect the Bangkok-Nong Khai route with Laos and southern China. However, the traffic demand on the route is not expected to be sufficient in the project’s initial years.

 

Later, the rail lines could also be extended to other Asean countries, such as Malaysia and Singapore, representing a modern Chinese version of the ancient Silk Road. 

 

Source: http://www.nationmultimedia.com/news/national/30317994

 

-- © Copyright The Nation 2017-06-14

[brucec64]

So a government that has promised transparency is using S44 to bypass procurement regulations designed to ensure transparency , and a government that has committed to end encroachment of state lands is using S44 to encroach on state lands.

Is there even a Thai translation for hypocrisy?

Sent from my SM-J710F using Thailand Forum - Thaivisa mobile app

[webfact]

Thai junta to invoke executive order to kick-start $5 billion rail project with China

 

BANGKOK (Reuters) - Thailand's prime minister will invoke an executive order to allow construction to start on a $5.5 billion railway project with China, which forms part of Beijing's regional infrastructure drive but has been beset by delays.

 

The high-speed link, in theory a centrepiece of Chinese-Thai cooperation, has been held up by years of negotiation over everything from cost and loan terms to land development rights.

 

A Thai government spokesman said on Tuesday that Prime Minister Prayuth Chan-ocha, who heads the junta that has ruled Thailand since a May 2014 coup, will invoke Article 44, a security order that gives him the power to push through policy. Prayuth will discuss the matter at a cabinet meeting next week.

 

The measure, dubbed the "dictators law", has been heavily criticized by rights groups. Government spokesman Sansern Kaewkamnerd said invoking Article 44 would clear hurdles such as building on protected land.

"This is why Article 44 is needed," he told reporters.

 

The $5.5 billion first phase of the railway will be a 250 km (155 miles) line between Bangkok and the northeastern province of Nakorn Ratchasima.

 

Transport Minister Arkhom Termpittayapaisith said last month that construction would begin in August or September.

 

Thailand will largely fund the project and China will provide technical assistance under terms agreed so far.

Including later phases, the project intends to build a 873-km rail line linkingThailand's border with Laos to eastern ports and industrial zones.

 

China wants to connect its cities to trade centres in Southeast Asia, includingThailand's eastern industrial zones, as part of its 'One Belt, One Road' project, while Thailand needs to revamp its aging rail network and boost trade.

 

Thailand and China have enjoyed warmer relations following the 2014 coup which saw several Western nations downgrade ties with Thailand in response.

 

The rail project, however, has hit various delays over details including construction funding and technical assistance.

 

(Reporting by Amy Sawitta Lefevre, Kitiphong Thaicharoen and Satawasin Staporncharnchai; Writing by Amy Sawitta Lefevre; Editing by Susan Fenton)

 

-- © Copyright Reuters 2017-06-14

[canuckamuck]

Article 44, like a hotline to heaven.

 

 

 

Edited June 13, 2017 by canuckamuck

[brucec64]

Thirty percent of $5.5 billion USD is a considerable payday for those in charge, so the urgency to get this deal done before possible elections is obvious.

Sent from my SM-J710F using Thailand Forum - Thaivisa mobile app

[yellowboat]

If anyone dies due to this sweeping of the hand, are the coup leaders still protected ?  This is a recipe for a train wreck.  Big projects like this get delayed all the time.  It is the nature of the business.  The junta, given their vast experience in governance, should know that. 

[klauskunkel]

All hail article 44

[Raymonddiaz]

How an unelected government can use tax payers money to do what ever it wants without accountability. Just crazy.! 

[hansnl]

And this for an unneeded mode of transport.

There are many other things needing a fast track, like traffic.

[scotchonrocks]

3 hours ago, brucec64 said:

Is there even a Thai translation for hypocrisy?

 

No

[scotchonrocks]

11 minutes ago, hansnl said:

And this for an unneeded mode of transport.

There are many other things needing a fast track, like traffic.

Don't forget submarines should be a top priority on the shopping list

[fforest1]

Not just in Thailand but all over the world there seems to be pretty

much unlimited funding for these high speed rail projects...

Not only are these projects expensive but the cost of a ticket

to ride these new rails is also quite expensive.... 

[anon4637435435]

Fast trains vs slow scooters and one of the most dangerous roads and public transport in the world. Still boggles the mind. 

How about using article 44 on yourself to fight terrorism and corruption. Your terrorizing the public from coups to media threats. I feel terrorized!

[Moti24]

No doubt they're going to build the railroad so they can transport the submarines to Thailand.  Probably the quickest way to get them here.

Edited June 14, 2017 by Moti24

[Srikcir]

5 hours ago, webfact said:

the project’s economic viability remains unclear despite investment of nearly Bt200 billion.

Article 44 cannot guarantee loan payoff nor sufficient revenues to maintain and recapitalize improvements and upgrades.

Yet it appears to date that the project will be an economic failure with regard to being self-sustaining. And unlike Yingluck who was held financially responsible by Prayut for the cost of her rice pledge scheme, Prayut gave himself immunity from similar financial responsibility for potential financial failure of this rail project. All these "rights groups" that remained silent during the overthrow of an elected government deserve all the consequences of the "dictator's law."

[chrisinth]

Shortcuts on shortcuts.

 

Anybody who knows anything about project management will know what that means, certain recipe for this ending in tears

[pookiki]

The sad part of this story is that it reinforces the perception that nothing will get done in Thailand without using Article 44 -- which, of course, reinforces the mandate for a junta-controlled society.

 

All of the issues addressed by the use of Article 44 in this case could be just as easily addressed by statutory means -- but that would reinforce the rule of law, not the rule of one man.

 

The most deleterious use of Article 44 involves the side-stepping of environmental impact issues as has been the case with power plants in the south.

 

Unfortunately, Prayuth will continue to use Article 44 to illustrate that one person running the country is the most expedient and 'best' use of political power.   And it will be used to stall any return to an elected government as well.

 

 

[huainnews]

  They talk about it as high speed but the sole purpose of this line seems to be to move Chinese freight from Laos to the Thai container ports.

  The only advantage to Thailand would be that a few local passenger trains in that region might average 100kph instead of the present 60kph because of the improved standard of the permanent way.

[halloween]

6 hours ago, huainnews said:

  They talk about it as high speed but the sole purpose of this line seems to be to move Chinese freight from Laos to the Thai container ports.

  The only advantage to Thailand would be that a few local passenger trains in that region might average 100kph instead of the present 60kph because of the improved standard of the permanent way.

As most passenger service only lines run at a loss, a dual function sounds like a great idea. I would expect that the port fees of handling Chinese shipping might be a benefit, and I'm quite sure the passenger service will exceed 100km/h.

At the very least it is investment in infrastructure, a better idea then wasting money on idiotic electoral bribes.

[Chama1]

Since Thailand is swimming in cash (huh?) might as well build a high speed train with help from people from a country with a great safety record. Shoot, maybe they can use it to move a submarine! 

[Italian guy]

On 14/06/2017 at 4:43 AM, webfact said:

Sansern said exemptions granted to the Thai-Chinese rail project will also apply to other similar and comparable transport schemes, as well as those in  energy and other sectors.

Mmmmmmmmmm 

[Srikcir]

19 hours ago, halloween said:

As most passenger service only lines run at a loss, a dual function sounds like a great idea.

The exception is if the loss from passenger service when paid out of profits from cargo service results in a net zero or loss, then a dual function doesn't matter.

 

The Transport Ministry Arkhom had wanted the SRT to conduct additional feasibility study on several scenarios such as how much impact on the SRT’s revenue if passengers are below target by 10% or what will the SRT do if passengers are below target by 20%. http://englishnews.thaipbs.or.th/srt-told-conduct-feasibility-study-thai-chinese-train-project/

As Article 44 bypasses such an analysis, who knows what the economic feasibility is?

 

However, it appears that the government is not depending on cargo service to provide an overall profitability from the rail line. Mr Arkhom reaffirmed the government’s faith in the project stating that they were worth the cost as projections have revealed that 60% of revenues will be generated from real estate and commercial developments along the routes while the remaining 40% will come from passenger fares. http://englishnews.thaipbs.or.th/bangkok-korat-high-speed-train-project-go-ahead-despite-call-revise/

 

But revenues from the developments accrue to the private ownership of rights along the line and do not accrue towards government rail revenues.  Certainly the government will benefit from any income taxes (unless exempted or minimized say to Chinese private ownership resulting from negotiations not yet concluded) from those developments. Whether tax revenue will make the line profitable overall is not mentioned.

 

The bottom line is very little has been revealed to the public as to what elements exactly will result in an overall profitable rail line. While a quasi-government project shouldn't ordinarily be profitable (ie., breakeven only), investment capital must be generated, ie., from profits, to fund a capital sinking fund to finance future retrofits and upgrades. By invoking Article 44 the government is going where every unprepared investor has gone before - into economic loss.

[pookiki]

6 minutes ago, Srikcir said:

The exception is if the loss from passenger service when paid out of profits from cargo service results in a net zero or loss, then a dual function doesn't matter.

 

The Transport Ministry Arkhom had wanted the SRT to conduct additional feasibility study on several scenarios such as how much impact on the SRT’s revenue if passengers are below target by 10% or what will the SRT do if passengers are below target by 20%. http://englishnews.thaipbs.or.th/srt-told-conduct-feasibility-study-thai-chinese-train-project/

As Article 44 bypasses such an analysis, who knows what the economic feasibility is?

 

However, it appears that the government is not depending on cargo service to provide an overall profitability from the rail line. Mr Arkhom reaffirmed the government’s faith in the project stating that they were worth the cost as projections have revealed that 60% of revenues will be generated from real estate and commercial developments along the routes while the remaining 40% will come from passenger fares. http://englishnews.thaipbs.or.th/bangkok-korat-high-speed-train-project-go-ahead-despite-call-revise/

 

But revenues from the developments accrue to the private ownership of rights along the line and do not accrue towards government rail revenues.  Certainly the government will benefit from any income taxes (unless exempted or minimized say to Chinese private ownership resulting from negotiations not yet concluded) from those developments. Whether tax revenue will make the line profitable overall is not mentioned.

 

The bottom line is very little has been revealed to the public as to what elements exactly will result in an overall profitable rail line. While a quasi-government project shouldn't ordinarily be profitable (ie., breakeven only), investment capital must be generated, ie., from profits, to fund a capital sinking fund to finance future retrofits and upgrades. By invoking Article 44 the government is going where every unprepared investor has gone before - into economic loss.

 

A very good analysis of the impact on Thailand.  However, I'm sure that China has a much different perspective and motive.  The junta has this paternalistic 'chip' on its shoulder that makes them all wise and, thus, will determine the best course of action for the people.

[halloween]

5 minutes ago, Srikcir said:

The exception is if the loss from passenger service when paid out of profits from cargo service results in a net zero or loss, then a dual function doesn't matter.

 

The Transport Ministry Arkhom had wanted the SRT to conduct additional feasibility study on several scenarios such as how much impact on the SRT’s revenue if passengers are below target by 10% or what will the SRT do if passengers are below target by 20%. http://englishnews.thaipbs.or.th/srt-told-conduct-feasibility-study-thai-chinese-train-project/

As Article 44 bypasses such an analysis, who knows what the economic feasibility is?

 

However, it appears that the government is not depending on cargo service to provide an overall profitability from the rail line. Mr Arkhom reaffirmed the government’s faith in the project stating that they were worth the cost as projections have revealed that 60% of revenues will be generated from real estate and commercial developments along the routes while the remaining 40% will come from passenger fares. http://englishnews.thaipbs.or.th/bangkok-korat-high-speed-train-project-go-ahead-despite-call-revise/

 

But revenues from the developments accrue to the private ownership of rights along the line and do not accrue towards government rail revenues.  Certainly the government will benefit from any income taxes (unless exempted or minimized say to Chinese private ownership resulting from negotiations not yet concluded) from those developments. Whether tax revenue will make the line profitable overall is not mentioned.

 

The bottom line is very little has been revealed to the public as to what elements exactly will result in an overall profitable rail line. While a quasi-government project shouldn't ordinarily be profitable (ie., breakeven only), investment capital must be generated, ie., from profits, to fund a capital sinking fund to finance future retrofits and upgrades. By invoking Article 44 the government is going where every unprepared investor has gone before - into economic loss.

 

But those capital developments will pay tax. And it seems it is predicted to be sufficient even without taking freight revenue into account, by your link.

 

I have no faith at all in a high speed passenger service raising much in the way of revenue. But a decent freight service will raise a lot of revenue with the anticipated level of Chinese freight and port usage.

 

And as you chose to delete it, I repeat - At the very least it is investment in infrastructure, a better idea then wasting money on idiotic electoral bribes.

[pookiki]

2 minutes ago, halloween said:

But those capital developments will pay tax. And it seems it is predicted to be sufficient even without taking freight revenue into account, by your link.

 

I have no faith at all in a high speed passenger service raising much in the way of revenue. But a decent freight service will raise a lot of revenue with the anticipated level of Chinese freight and port usage.

 

And as you chose to delete it, I repeat - At the very least it is investment in infrastructure, a better idea then wasting money on idiotic electoral bribes.

I'm sure there are a lot of 'bribes' going around without the need for the adjective 'electoral'. 

[halloween]

Just now, pookiki said:

I'm sure there are a lot of 'bribes' going around without the need for the adjective 'electoral'. 

And I'm quite sure you would rather criticise the current regime without any comparison to the former, but it isn't going to happen.

 

On the bright side, they won't have to pay for lunchbox design, will they?

[pookiki]

1 minute ago, halloween said:

And I'm quite sure you would rather criticise the current regime without any comparison to the former, but it isn't going to happen.

 

On the bright side, they won't have to pay for lunchbox design, will they?

Well, if memory serves me right, the prior regime is being held accountable by a junta that has no accountability.  A comparison I find quite significant.  Where is the voice of the people in the junta's  decisions -- does it matter to you?  Lastly, does there need to be a comparison for criticism that is warranted and justified?

[halloween]

3 minutes ago, pookiki said:

Well, if memory serves me right, the prior regime is being held accountable by a junta that has no accountability.  A comparison I find quite significant.  Where is the voice of the people in the junta's  decisions -- does it matter to you?  Lastly, does there need to be a comparison for criticism that is warranted and justified?

You see your criticism as warranted and justified. I see it as SOP, certainly premature, of an investment in infrastructure that promises to far more benefit for the nation than ensuring the "right" people get elected. If it turns out to be a huge white elephant, at the very least the Thai people will have an upgraded railway system to show for their money. Much better than warehouses full of mouldy over-priced rice.

[pookiki]

2 minutes ago, halloween said:

You see your criticism as warranted and justified. I see it as SOP, certainly premature, of an investment in infrastructure that promises to far more benefit for the nation than ensuring the "right" people get elected. If it turns out to be a huge white elephant, at the very least the Thai people will have an upgraded railway system to show for their money. Much better than warehouses full of mouldy over-priced rice.

And I'm sure that the Thai people will benefit from the Chinese military weapons as well.  Corruption for which the junta will never be held accountable and an egregious disregard for the real needs of the Thai people.  Mouldy rice vs. mouldy minds.

[halloween]

13 minutes ago, pookiki said:

And I'm sure that the Thai people will benefit from the Chinese military weapons as well.  Corruption for which the junta will never be held accountable and an egregious disregard for the real needs of the Thai people.  Mouldy rice vs. mouldy minds.

If you can't argue the topic, change it. Firstly, purchase of military weapons isn't corruption in itself - if you have proof there is corruption involved please present it. Secondly, Thailand's military spending as of 2016 was 1.45% of GDP, lower than the world average of 2.2%. Would you like to nominate your home country for a comparison, or would that be uncomfortable for you?

https://en.wikipedia.org/wiki/List_of_countries_by_military_expenditures

https://tradingeconomics.com/thailand/military-expenditure-percent-of-gdp-wb-data.html