CROUCH before you leap. That’s the strategy of Thai government in changing the country’s economic development course in the next few years.
Speaking at the Money Talk seminar at the Stock Exchange of Thailand (SET) over the weekend on Thailand’s economic situation in 2017, Dr Kobsak Pootrakool, Vice Minister for Office of the Prime Minister, pointed out that last year and this year, Thailand’s GDP will grow in the region of 3-4 percent.
Many called this slow growth phenomena “new normal” but that’s not the case as our neighbors like Malaysia, Philippines and Indonesia have enjoyed higher growth rates than Thailand.
“Because Thailand had undergone an internal conflict for almost ten years while there has been no new platform for the country’s economic development during the period, we just did what we used to do.”
Now under the current government, Thailand has started to undergo a major restructuring involving new infrastructural plan, new industrial 4.0 and new Thai people under the 4.0 development plan.
The Thai private sector had been upset by the previous seven governments during the past ten years over promises to invest in the infrastructural projects, which never happened
Now under the Prayuth Government, things have changed.
“Thailand was the first country in this region to have a railway system during the King Rama V era along with Japan but we had something like 150 km. of new railway being added during the last 150 years!”
Last year, he added, Thailand launched a plan to build 1,000 km of railway. This year another 1,000 km will be added. The Mapkrabao-Chira double railway project had undergone bidding for a contractor late last year and just two months later, construction has started, and this quick launch of construction is considered a “miracle” in a state project development. There are also five to six electric train projects expected to be launched this year.
The new motorway projects have also started while the high speed rail project is expected to start 2020 at the latest. The major improvement in the country’s logistic system will hugely help improve trade and investment.
The government has also allocated over 20,000 million baht to launch the village internet service as part of its plan to provide the internet infrastructure to the people in the rural area so as they will have a chance to trade their goods online without having to rely on the middlemen.
Where industrial development is concerned, this government has launched a plan to expand the eastern seaboard by having a new deep sea port and a new commercial airport at U-tapao.
“We have got a very good response from foreign investors over this major plan as U-tapao will also be a regional aircraft maintenance center, in which Airbus has expressed interest. It will be more convenient for most airlines to come here for maintenance services.
“The eastern seaboard will be ready to gear up for new industries like electric vehicle, robotic, food and high end petrochemical.
“We are trying to launch as many projects as possible and that’s why we are not accelerating the current economic growth this year. When the new government comes in, the new CEO will just allocate the budget to finance the projects which have already been approved or launched. This means after two years of crouching, Thailand will be ready to leap within the next two to three years.
“There’s a blessing in disguise by launching as many infrastructural projects as possible during this government. The Suvarnabhumi Airport expansion project, for example, had listed a total cost of around 60,000 million baht six years ago but today under the Prayuth government, the project cost has been reduced by 28%. So if we can implement any projects this or next year, the overall costs would be reduced by 20-30%.”
All in all it will be busy years ahead for the construction and related firms as well.
Top: Thailand’s largest port Laem Chabang is about 25 kilometers north of Pattaya. Photo: NNT
Inset: U-tapao Rayong-Pattaya International Airport terminal. Photo: Utapao.com
By Kowit Sanandang