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MONDAY, December 04, 2023

Thai-Chinese rail project: The arduous task of finding ‘win-win’ formula

Thai-Chinese rail project: The arduous task of finding ‘win-win’ formula
WEDNESDAY, July 26, 2017

Chinese Foreign Minister Wang Yi was in town earlier this week and, to nobody’s surprise, the main topic he raised with Prime Minister Prayut Chan-o-cha was the Thai-Chinese railway project.

The rail scheme has become more than just a running economic issue between the two countries. It has in fact been so politicised that when Prayut was left off the list of six Thai Cabinet members invited to the One Belt One Road Summit in Beijing recently, speculation arose that the Chinese government was in effect sending a warning to the Thai leader – and it had everything to do with the “delay” in the rail project.
There was an interesting diplomatic twist to the incident, though, when Chinese leaders extended an invitation for Prayut to join the BRICS (Brazil, Russia, India, China and South Africa) summit – which triggered rumours that Beijing had actually “raised the level” of the invitation.
But while in Bangkok, Wang Yi did underline Beijing’s serious concern over the project by urging that construction of the rail project should be sped up so that Thailand could connect to big markets in China and become a regional transit hub.
“Thailand is part of the important junctions both for land and marine transport in the One Belt One Road Initiative. Therefore, Thailand is a very important partner,” the Chinese foreign minister stressed.
The next Thai-Chinese meeting on the scheme will be the 20th in a series of discussions that have been plagued by tough bargaining on both sides.
Chinese envoys have complained to me about the “slow progress” and “bureaucratic haggling” that have frustrated their government. Thai officials have likewise put the blame on the inflexible stand taken by the Chinese, which, they claimed, was weakened by the lack of coordination among various organisations on China’s side.
The Thai government has been caught in a dilemma from the very start, having to balance the national interest against working out a “win-win” solution with Chinese apparently bent on cutting a deal that would put China’s engineering prowess on the world map.
Transport Minister Arkhom Termpityapaisith, sensitive to the danger of nationalistic feelings being roused by any suggestion the government is kowtowing to the Chinese side, insisted publicly last week that: “We are no ‘pigs’ [easy targets]. We have been striking a hard bargain all along. From Day One, the government refused to give up rights that some other countries might have been compelled to offer the Chinese side. We knew what the contracts said between China and those countries,” he said in an interview with Thai Post.
Insiders have told me that the prolonged negotiations at times veered into absurd roundabout arguments. 
A senior official who took part in some of the heated debates related a classic bureaucratic no-win situation:
“The Chinese side proposed a certain figure for the cost of the whole project based on their design. We said we could only consider that when they gave us all the details of the design. They said they didn’t have details because the work on the design hadn’t even started yet. We then countered that, since the contract hadn’t been signed, we could not possibly pay the design fee. Then the Chinese side said we must first submit the project for Cabinet approval so that they could move ahead. We went back to them, saying that we couldn’t possibly submit the scheme for Cabinet approval if they couldn’t come up with the design … the talks went around and around, with no end in sight.”
In the end, the issue was resolved only when the Thai officials referred the matter to the transport minister, who contacted the China’s ministerial-level decision-makers. That’s when politics intervened – and the technical people as well as the bureaucrats went back to haggling over the details once again.
The barrier has apparently been brought down now that political will from both sides has overridden technical and economic considerations. But the railway project could still hit unexpected blocks unless all the conditions and details involved are revealed for public scrutiny and debate.
At one point, during the height of the closed-door debates, there was an ugly to-and-fro about whether China needed Thailand more – or the other way round.
That debate risked trespassing on dangerous political zones, especially given the interdependence of the international ecosystem. Hopefully, the right diplomatic balance has been restored – and all parties concerned can accept the fact that a mutually beneficial arrangement is the only way forward for both countries.