Sino-Laos-Thai rail project still expected to go ahead

PUBLISHED : Monday, 04 July, 2011, 12:00am
UPDATED : Monday, 04 July, 2011, 12:00am

The election in Thailand and the recent downfall of former Chinese minister of railways Liu Zhijun may be causing a temporary setback to a multibillion-dollar high-speed railway aimed at linking China, Laos and Thailand, but the setback is unlikely to prevent the project from becoming a reality.

'The project has been stagnant for the last couple of months,' said a Thai official linked to the project, who asked not to be named.

In April, the Thai government sent a draft of a memorandum of understanding (MOU) on the Thai high-speed railway to China, but had not received a response, the official said. Previously, China would normally respond within a few weeks to Thai communications about the project, the official added.

'It may have something to do with Liu or the Thai elections, or both.'

In February, Chinese state media announced that Liu had been dismissed as railways minister for a 'severe breach of discipline', a code word for suspected corruption.

In February, Thai Permanent Secretary for Transport Suphoth Sublom said that Thailand expected to sign the MOU with the Chinese government in April to jointly develop a 150 billion baht (HK$37 billion) high-speed rail line. Under the MOU, a 620-kilometre fast line between Bangkok and Nong Khai in northeast Thailand near Laos will be run by a joint venture to be set up by the Thai and Chinese governments.

The line is part of five high-speed rail lines in Thailand proposed by China, which will have a total length of 3,133 kilometres and cost US$32.8 billion, the Thai official said.

The China-Laos-Thailand high-speed railway is part of a long-term plan to connect China to Singapore by high-speed railway.

In Laos, the ground-breaking ceremony scheduled for April 25 for the US$7 billion Laos section of the China-Laos-Thailand high-speed railway failed to materialise. Laotian Deputy Prime Minister Somsavath Lengsavat blamed the missed deadline partly on Liu's dismissal. 'The ministerial reshuffle has slowed down the project a little bit because they [the Chinese] had to conduct an internal adjustment,' Somsavath told the German press agency DPA.

In October last year, Liu signed an MOU on Sino-Laos co-operation in building the Laos high-speed railway with Laos Minister of Public Works and Transport Sommath Pholsena.

Most Thai political parties support versions of a high-speed rail network, the Thai official said.

'The dismissal of Liu Zhijun may temporarily slow down the implementation of high-speed railway in Thailand, but not significantly,' the official said. One important benefit of a high-speed railway linking China with Southeast Asia, he said, was that it would free up more capacity for freight on ordinary railways.

The financing of the Thai high-speed railway will be undertaken by an investment company, probably with the Thai side holding 51 per cent and the Chinese 49 per cent, as Thai law required such a national project to be financed by a Thai company, he said. 'Though high-speed railway is generally expensive, Chinese high-speed-rail technology makes it within our financial capacity.'

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