Govt urged to ask Chinese to share cost of railway
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THE GOVERNMENT should review its plan to borrow money from China to finance the electric-railway project between Bangkok and Nong Khai, a former finance minister and Democrat Party MP has said.
Korn Chatikavanij said the government should enter a joint venture with China rather than shoulder the full financial burden on its own.
According to a memorandum of cooperation between the two countries, the Thai government would borrow the money to finance the project, not enter a joint venture with Beijing.
“I want to see a joint venture between the Thai and Chinese governments, as it will be difficult to get a return on investment from some parts of the line,” Korn said.
An August deadline has been set to finalise the structure of financing before the first phase of construction starts in October.
The railway project was first planned by the Democrat Party government under Abhisit Vejjajiva in 2010. But the original memorandum of understanding signed by the two governments called for a joint venture to develop the line.
Korn said the government should seek a way to reduce the country’s burden by persuading those who might benefit from the project to share the burden.
The Bangkok-Nong Khai rail line is strategically essential to China, he said. If Thailand did not carry on the line in the South, the Kunming-Singapore route could not be initiated successfully.
“China has the financial clout and it expressed its readiness to embrace the investment in the project in the past. Hence I would like the government to reconsider the arrangement,” he said.
The Bangkok-Nong Khai rail line is expected to be 873 kilometres in length with dual tracks and a 1.435-metre gauge.
Korn said transport mega-projects in the past had a tendency to go over budget, an extra burden the taxpayers had to bear. “If the government opts for a 100-per-cent loan, the people will also bear 100 per cent of that burden.”
Optimum benefits
On the other hand, China will get optimum benefits from the rail line in terms of construction contracts and the sale of rail equipment and rolling stock.
At the same time, if the government claims the project would help develop the property market along the railway route, which means the property sector will benefit while pushing the cost burden on to the people.
Korn also said the high-speed-rail project between Bangkok and Chiang Mai, to be built with the cooperation of the Japanese government, would not be worth the investment, as it would take 300 years to break even.
