In a recent forum about transport infrastructures hosted by the Bangkok Post, Thailand Minister of Transport Chadchat Sittipunt admitted that Thailand needs urgently to upgrade its infrastructure, justifying the government’s stance to invest up to 64 billion US dollars into large transport projects.
BANGKOK- At the end of July, Thailand Transport Minister Chadchat Sittipunt made a passionate plea to get the support of all political parties for endorsing a massive infrastructure investment plan worth THB two trillion (US$ 63.7 billion). The plan would run over a period of seven years and cover the development of new MRT lines in Bangkok, four new high-speed train lines, the electrification and double-tracking of the rail network across the country, improving port facilities as well as setting new motorways.
Such an investment would be necessary as Mr. Suttipunt spoke openly for a lost decade in infrastructure. At the forum the minister indicated that “the past 10 years has been a lost decade with one coup, seven governments, seven political parties dissolved, one devastating flood… The economic loss as been THB 1.7 trillion [US$ 54 billion]”.
The Minister is rather modest: Thailand has been going backwards in terms of infrastructure development over the last 40 years- at least. Name it incompetence of the administration, corruption, political instability and generally bad governance, the result is there. Thailand has been dragging its feet for almost half a century to bring its infrastructure to standards which would be on pair with Malaysia or China rather than Indonesia or the Philippines.
The rhythm of achieving a single infrastructure in Thailand is reaching indeed abysmal proportions. Bangkok Post journalist Voranai Vanijaka pointed out in a Sunday editorial that it took 30 years to complete Lat Krabang Port infrastructure near Bangkok (1961-1991). The Port still lacks today cruise terminal facilities or a rapid rail connection to Bangkok, two hours away by bus!
Looking at Suvarnabhumi, it took 46 years to see the first aircraft landing at the airport since the first planning (1960-2006). The announcement of a high speed train between Bangkok and Rayong back in 1994 is still waiting for its first kilometer of track while only 15% of the promised double-tracking of the rail network has been achieved – following a decision taken in 1993!
Year after year, successive governments spent their energy to undo decisions taken from previous governments and called back new bids to finally assign again exactly the same project to a company. What Thailand is deeply missing is a Government which would assume its State duties and guarantee State continuity, whoever comes into power…
The most obvious result to such policies? Thailand has lost its appeal as an investment destination. Comparing ranking between the World Economic Forum Survey of 2010-11 and 2012-13, the Minister pointed out to his audience that Thailand declined from rank 57 to 65 for the competitiveness of its rail, from rank 28 to rank 33 for its roads, from rank 43 to 56 for its ports and from 28 to 33 for its airports. The Kingdom today ranks 49th in infrastructure competitiveness. This is far behind Singapore (2nd), Taiwan (27th) or Malaysia (29th).
At the same time, Thailand’s ranking as a recipient of foreign direct investment (FDI) has fallen from second to fourth between 2004 and 2012. Thailand annual growth in FDI was only 5% on average for the period 2004-2012 compared to 10% for Malaysia, 23% for Vietnam or 34% for Indonesia.
Boosting then infrastructure is more than necessary with economic benefits to be certain in terms of employment, consumption but also in the longer term investments. Thailand has all the assets to be turned into ASEAN Northern hub, especially towards the entire Greater Mekong Sub Region. “Stronger connectivity would have tremendous social benefits as well as bringing communities closer to each other. If we are not ready for the integration of ASEAN economies under the AEC in 2015, investors will just go elsewhere,” pleaded the Minister. Investors did not wait for the Minister’s statement.
Luc Citrinot a French national is a freelance journalist and consultant in tourism and air transport with over 20 years experience. Based in Paris and Bangkok, he works for various travel and air transport trade publications in Europe and Asia.
