Connect with us

Economy

A Land Bridge or the Kra Canal for Thailand?

Thaiger

Published

 on 

OPINION by guest writer Tony P Restall

Why the land bridge idea will never work

Much has been written about the long-proposed Thai or Kra Canal and the on and off decision to proceed, or not. Over the recent years several high-level committees have examined the economic benefits to establish a water connection by means of a canal linking the East Coast of Thailand to the West Coast. For hundreds of years there has been proposals to cut a Canal across the Kra Peninsular, the skinniest part of the Malay Peninsula, to facilitate a short cut and avoid the transit of sea going vessels past Singapore and the Malacca Straits.

Unlike the significant financial savings by ocean going vessels using the Panama and Suez Canal and the significant time/distance to sail around the cape route, the Kra Canal will not provide any significant financial benefits. So why should Thailand and its Government even consider such a project and the very significant construction costs (estimated at US$50 billion).

In these times of massive economic pressure on places like Thailand, and its loss of ‘tourism revenue’, hundreds of thousands of people are finding themselves unemployed. Who in their right mind would commit to such a massive infrastructure investment when the country is in economic stress?

How would Thailand ever hope to repay or cover the infrastructure cost of such a major infrastructure investment?

China had mooted an interest to fund and construct the Kra Canal, but what we have all witnessed globally with so called ‘Chinese Help’. Would Thailand want a foreign power controlling and running such a strategic facility? Of course not, so naturally to reject the very concept of the Kra Canal appears to be done & dusted. Much to the relief of Singapore and Malaysia, who would have been significantly disadvantaged should such a canal having ever been given the go ahead.

Singapore is the largest vessel anchorage in the world with up to 1,000 vessels at anchor at any one time. The Value-Added benefit to Singapore such as providing fuel and all the other maritime support services has put Singapore well and truly on the world maritime map. Singapore has a population of some 5 million people and the per capita per person is significantly higher than that of Thailand. The vulnerability of Singapore, and its main achilles heel, is the very narrow and very busy Malacca Straits which is already highly utilised and risks of a maritime incident rise daily the busier it becomes.

So why would Thailand benefit from the development of the Kra Thai Canal?

Passing trade (through such a canal) would provide access to global trade, meaning that jobs could be created and factories and manufacturing could be established.

‘Rubbish’ I hear many of you say – something I have heard many times in my Free Zone Life.

When Dubai established the first Free Trade Zone I heard the same accusations and even more when the Ruler of Dubai constructed a second Port in Dubai when the entire UAE population as just over 1 million. The writer was there and led the commercial development of Jebel Ali Port and a year later Jebel Ali Free Zone.

“It’s a white elephant and never going to work” most of the critics said.

Gladly I am able to report they were wrong. VERY wrong, as last year Jebel Ali Port & Free Zone contributed US$140 billion in free trade towards the US$500 billion economy of Dubai. The 67 berth Deep Water Port has been expanded to cover 92 berths and Dubai now has 23 Free Zones. Yet Dubai and the UAE Free Zones lack certain elements… it is off the Trade Maritime Route (requires a deviation), has no available local labour, and is forced to import 5-6 million foreign workers.

What could Thailand do by creating jobs for 5-6 million Thais?

The $50 billion investment cost in infrastructure of the Kra Thai Canal would be recovered very quickly (less than 10 years I estimate) and at the same time provide Thailand with an increased GDP and massive employment in sectors such as rice farming and rubber plantations.

How to prove this?

The writer (after the tsunami that hit Thailand’s western coastlines) proposed a pilot scheme Free Zone in Phuket – at Ao Makham in 2006 . Investors from Qatar and the UAE came to Phuket and confirmed their willingness to invest.

(I bet people now wished they had listened to that offer as again Phuket and Thailand is suffering due to lack of Tourism Revenue.)

Phuket and other locations could have had a very significant and secondary revenue flow over and above the tourist dollar. During discussions and several Kra Canal Conferences the writer challenged the Thai Government to permit a pilot scheme Free Zone in Phuket to prove the claim that such a facility would create jobs and a massive revenue stream. There are those in power that didn’t understand and weren’t willing to listen and think outside the box. As a result, Thailand now finds itself in another deep economic hole.

Meanwhile, the ‘land bridge‘ alternative… that surely is a joke and beyond any logical thinking. When Dr Mahathir Mohammed was returned to power as the Malaysian Prime Minister, he immediately cancelled the proposed land bridge concept for Malaysia. Yet Thailand is seriously considering that option?

To save what? 1-2 days sailing time around Singapore and through the Malacca Straits?

Not only is it a completely ill-conceived idea, the numbers will never stack up and the vessel operators would never even consider it viable. Extra handling costs (1 day offloading, 1 day in transit overland and 1 day reloading). There would be no valid gain. Every time a container is handled it incurs extra cost. The Land Bridge idea simply hasn’t been thought through. Malaysia’s Dr Mahathir Mohammed saw through the problems very quickly, so why is Thailand even considering it?

Written by Port & Free Zone Global Expert, Tony P. Restall (aka Mr Free Zone)

A Land Bridge or the Kra Canal for Thailand? | News by Thaiger

 

Get more from The Thaiger

📱 Download our app on Android or iOS
👋 Have your say on our Thailand forums
🔔 Subscribe to our daily email newsletter
📺 Subscribe / Join YouTube for daily shows
👍 Like/Follow us on Facebook
🐦 FOLLOW us on Twitter
📷 FOLLOW us on Instagram

image

Join the conversation and have your say on Thailand news published on The Thaiger.

Thaiger Talk is our new Thaiger Community where you can join the discussion on everything happening in Thailand right now.

Please note that articles are not posted to the forum instantly and can take up to 20 min before being visible. Click for more information and the Thaiger Talk Guidelines.

19 Comments

19 Comments

  1. Avatar

    Rinky Stingpiece

    Wednesday, September 9, 2020 at 12:00 pm

    It is a silly project, and makes about as much sense as a canal through Korea or Japan.
    Trying to compare it to Jebel Ali or Suez or Panama is ridiculous. It’s not comparable at all.
    For any vessel to pass through the canal its speed will be reduced, and it may have to go through locks and various inspections, which eliminate any significant speed gains from going via Singapore. Bear in mind that Singapore offers substantial drydock and other marine industry goods and services that Thailand has none of, as well as a much more business-friendly bureaucracy.
    There’s much more to this than just digging a ditch and putting shops along the side of it, and hoping that the 50 billion investment automagically is returned. Your case is specious at best.

    You also fail to consider the environmental degradation, and the obvious conflict with tourism, which is a larger industry than shipping in Thailand.
    Of the four proposed routes they all cut right across the most prime tourism assets around Koh Samui, Koh Tao, two routes across to Krabi, Phuket and Ao Phang-Nga, one of them comes out in Trang near the marine park with endangered dugongs, and another out near the Similan islands and Mergui archipelago. You would have to do significant industrial development either side with devastating impact on fragile tropical ecosystems that are just beginning to recover.

    On top of that, you fail to consider the influence of Singapore and Malaysia in China, Temasek holds substantial assets in China, and does have influence and every incentive to use that influence.
    Both ideas, the canal and the land bridge are equally silly and non-starters financially.

  2. Avatar

    Toby Andrews

    Wednesday, September 9, 2020 at 12:12 pm

    Well first this is not the narrowest part of Thailand. That is further north.
    Second Thailand with all their supposed wealth cannot afford to pay for this canal.
    They cannot even afford a second hand submarine without paying for it in instalments.
    Unless the Chinese build this canal for them, they will default on payment, which they have a history of doing in regards to foreigners.
    The Chinese can force payment with their trade – Thailand don’t pay, Thailand cannot export to one of the biggest markets in the world, China.
    Thailand could not afford this canal without foreign finance, and that is drying up after the Thai unreasonable oppressive antics during this pandemic. Who can trust the Thais now?

    • Avatar

      Issan John

      Wednesday, September 9, 2020 at 3:36 pm

      @Toby Andrews, you ask “who can trust the Thais now?”.

      I’d suggest that everyone who trusted the Thais before Covid-19 can, as well as anyone else who respects Thailand’s eminently sensible and very reasonable reaction to the pandemic, both by the government and by Thai people in general.

      As for submarines, while a very different issue, the ones Thailand is purchasing are new, not yet built, not “secondhand”, and all countries buying similar foreign vessels or equipment for their military pay “in instalments” rather than in advance or COD.

  3. Avatar

    Issan John

    Wednesday, September 9, 2020 at 12:39 pm

    As ‘Rinky Stingpiece’ said, a “silly project” and utter nonsense.

    Far from having “led the commercial development of Jebel Ali Port and a year later Jebel Ali Free Zone” as the self-styled “Mr Free-Zone” claims, he was a minor sales manager there who is now trying to get taken seriously and peddle snake oil in Thailand with this absurdity.

    There’s a point to the Jebel Ali port and free zones, as there is to the Panama and Suez canals. There is simply none to a canal across Thailand.

    His idea that because his proposal for a ‘free zone’ in Phuket was rejected so … “As a result, Thailand now finds itself in another deep economic hole” would be laughable if it wasn’t quite so absurd on every level.

    I’ve read some nonsense here written by self-styled experts desperate to be taken seriously as they pad their CV’s and LinkedIn profiles, but this has to top them all.

    • Avatar

      Issan John

      Wednesday, September 9, 2020 at 3:11 pm

      I was even more amused on re-reading, seeing that apparently “passing trade (through such a canal) would provide access to global trade, meaning that jobs could be created and factories and manufacturing could be established.”

      How?

      Unlike a port, where ships load and unload, the whole point of a canal is that ships “pass” – they’re “passing trade” and don’t / can’t stop to allow any “access to global trade” or access to anything. The Panama and Suez canals are prime examples of this, despite the amount of “passing trade” transiting through.

      There would be no reason for any “factories and manufacturing” to “be established” that wasn’t already there (location, labour, materials, infrastructure, etc) before the canal, and the canal wouldn’t / couldn’t add to that in any way – the extra security issues would also be detrimental to any local factories or industries.

      This is pure nonsense.

  4. Avatar

    Toby Andrews

    Wednesday, September 9, 2020 at 5:13 pm

    Yes you are right Issan john. The submarine the Thais are buying is new. However buying a submarine at this time of economic crisis in Thailand is plain stupid. Indeed the Thais have cancelled interest in a further two.
    You state: Anyone who trusted the Thais before Covid 19 – can now.
    Well who did trust the Thais? I have never met anyone, and any that did often lost their life savings.
    Need I point out the many different reasons not to trust the Thais. For instance.
    Dual pricing and hiding the fact with sneaky Thai script.
    The police and prosecutors that let a young punk go free after killing a policeman, for reasons unknown.
    Putting prices out side a bar and when the bill arrives charging more.
    Giving change for a B500 when the customer gave a B1000 note.
    Taking a deposit for a Jet Ski hire and claiming false damage on the jet ski, then claiming ten time the cost of the damage.
    Bus companies that drop foreigners out side of town where their taxi pals charge to ferry the passengers into the town bus station.
    Selling a foreigner’s house while he is away by forging his signature on a property transfer – with the collusion of crooked Thai lawyers, then selling the house at a bargain price to accomplices.
    One German company had to grab a royal private jet to obtain payment on a contract they completed for Thais in Thailand.
    And as for this present government. They continue oppressive, unneeded, crooked administration on the excuse of a pandemic, simply to keep the powers of dictators, which means no elections, and suppressed demonstrations.
    You will see how much the Thais are trusted, when foreign investors scramble to halt projects, sell anything they can in Thailand and get out never to return . . .

  5. Avatar

    Paul

    Wednesday, September 9, 2020 at 5:53 pm

    The canal can become a motor for industrial development for Thailand. It can and will create jobs and it can earn itself back. 2 days shipping or 1200 km sailing costs around 50k average. Charge about 40% of that, create facilities, develop the direct environment: those jobs and skills will go a long way.
    History has shown that critics do not create. They just criticise. If they can find an investor, everyone will benefit!

    • Avatar

      Rinky Stingpiece

      Thursday, September 10, 2020 at 1:26 pm

      It really won’t do those things. Have you ever sailed through the Suez canal? There’s no industry and jobs along the sides of it. Critics speak from experience, which is a vaccine for the virus of stupid ideas. Have you looked on the map and seen how many mountains there are along the isthmus? Are you aware of the critical economic and environmental importance of the southern coasts of Thailand to Thai people? Do you know how slow a ship travels through a canal compared to sailing around? Do you know what the needs of a ship are in terms of replenishment and repair and other infrastructure that comes from having a major international port like Singapore?!
      The 50BN estimate for blowing a gorge through the mountains running down the middle of Kra wouldn’t even touch the sides of the entire investment needed to develop a port at each side the size of Ma Tha Phut or Laem Chabang, and even they are dwarfed by other regional ports.
      You simply don’t know what you’re talking about, in terms of engineering or economics. You may as well propose that they build a space launch site, and build Tie Fighters and a Death Star, that would bring loads of jobs, and pay for itself quicker than a pointless canal like this.
      The sort of jobs and development Thailand needs is in computing and IT, not heavy industry. That’s where real profitability and skills training is.

  6. Avatar

    RR

    Thursday, September 10, 2020 at 12:05 am

    The canal would be ok if they detonated there 4-5 atomic bombs in line to make a large and deep passage, otherwise it is not worth.

  7. Avatar

    Sam W

    Thursday, September 10, 2020 at 8:50 am

    Achilles heel, not heal.

  8. Avatar

    Tony Restall

    Thursday, September 10, 2020 at 7:03 pm

    Happy to see this has stimulated such debate and comment despite the personal comments but comes with the territory when you put a target on your chest.
    The Kra Canal Study was re-written by Pakdee Tanapura a few years back but lacked rationale despite inviting both Panama and Suez Canal Representatives. I totally stand by what I say and can prove the numbers and statistic. The proposed routes further north are also quite ridiculous as they would expose high volume tourist areas where the obvious more southerly route scares the Thai Authorities deep in Muslim territory. Industrial Zones (SEZ) havent worked at all well in Thailand by are taking off in nearby Vietnam who has also taken Thailands Crown as Major Rice Exporter in the region. Employment creation in places such as Singapore took several generations and the once garment industries are no more ( Replaced by High Tech). High Tech wont aid the Rice and Rubber Farmers looking for work.
    Why was Dubai the First Free Zone?
    Because next door Sharjah (developed the concept) but were too conservative to be first to launch it…

    • Avatar

      rinky stingpiece

      Friday, September 11, 2020 at 3:38 am

      You really can’t back up those numbers. You don’t have any experience of the marine sector, and you completely fail to address the many very real problems with this concept.
      Bloggers from Singapore and Malaysia aren’t needed to point out the geology of the isthmus… it is obviously more expensive to either blast through mountains or build a large number of locks. You also have to have the right width and depth to get the right sized vessels physically through it. You have to establish the actual speed of a vessel moving through the whole system, which will be very low numbers of knots, plus additional time costs in lock transitions, and then add up all that time and compare it to the relative simplicity of motoring round the peninsula at double figures of knots. You also have to add in the cost of queueing and waiting for access to your hypothetical canal. It’s simple maths really. It takes quite a few hours to transit Suez, even without locks, and ships queue at Mediterranean coast. The cost of accessing the canal for any small amount of time you think you might save is not economic for ship operators. Your canal would have to be cheaper than the cost of fuel for travelling around the peninsula, and would have to vary with the price of HFO.
      The part of the isthmus with the least amount of material and mountains in the way, is the part west of Ko Samui across to Ranong. You have to explain how you are going to accommodate tourism in those established prime spots on the east coast with several hundred large vessels motoring through and anchoring off the coast as they queue to enter this hypothetical canal. They may also be legitimately subject to inspection for things like ballast water invasive species and pollution, given that the east coast is a prime tourist area, and the west coast is a sensitive conservation area, and also a prime tourist area. There are reasonable questions about how you mitigate environmental degradation that would affect both prime tourism and sensitive marine coastal ecosystems which play a key role in the food web and coastal livelihoods of local people.
      Why do you think it’s easier to blast through even more rock for even further in the south of the isthmus, or build even more locks to get up and over the mountains, when the location is even nearer to the simpler route around the peninsula?!
      You basically prove that the project is nonviable, because you recognise the impact on tourism and environment in the north, where the imagined time saving for ships is theoretically greater, and you recognise that the insurgency in the more mountainous and wider south is not viable as well because of that insurgency. The idea is a complete non-starter, better off spending all that on an undersea tunnel from Phuket to Medan if you like grand projects.

      After you’ve address all that, you then need to describe cost up and design the development of infrastructure for ports, drydocks, cargo handling, fuel storage, equipment and maintenance companies, staff, training establishments, and ancillary support services. This would require building a new city and port complex larger than Map Tha Phut, to compete with existing options, and where would you put it? Surat Thani? Ranong? It needs an airport, motorway, and rail links, and all the other modern infrastructure. Your scheme will sink way more than $50BN. It’s a hit and hope idea, where you assume that you can get enough traffic paying the fees to pass through your canal for long enough to pay it off… it would bankrupt the nation.

      What you are essentially proposing is similarto cutting a canal through Denmark or from Bristol to Southampton, or across Italy or Korea or Japan or UAE. It doesn’t make any sense from an economic, environmental, and industrial point of view, and doesn’t offer anything of interest to marine operators.

      You can’t prove the numbers, because you don’t know them.

      High tech will aid the children of rice and rubber farmers looking for work, education and training in software development, IT, light industry, these are industries that are COVID proof. Your ideas about the shipping industry are living in the past, that ship has sailed, there are no big profits to be made like in the golden years, even Dubai understand that as they shift more aware from shipping and oil and towards “high tech”.

      • The Thaiger & The Nation

        The Thaiger & The Nation

        Friday, September 11, 2020 at 11:31 am

        We’re going to publish some of your response. Thanks for the long and considered response. Obviously with time on your hands at the moment!

        • Avatar

          Rinky Stingpiece

          Saturday, September 12, 2020 at 1:04 am

          It doesn’t take that long to touch type.

          The land bridge idea, if I understand it correctly, seems more feasible than a canal, but I don’t see what’s in it for anyone. I don’t see what problem it’s solving. You may as well build a hybrid land-bridge-canal, with a watery lift and an elevated canal like the BTS 😀

          If the idea is to take business from Singapore, then turn Songkhla or Ranong into a bigger city with drydocks and all the other infrastructure. It will take a decade to realise.

          There’s a mild case to be made for avoiding piracy in the straits of Malacca, by a northern canal, but the savings are nothing like those that Suez and Panama provide, because they let ships avoid sailing around whole continents!

          Just trying to shave off a couple of days for ships isn’t really specifying a problem that needs solving, the ships are just ways of moving cargo, so the real problem is how to move the cargo, and ships aren’t the only answer.

  9. Avatar

    Tony Restall

    Thursday, September 10, 2020 at 9:19 pm

    Of Course Malaysia and Singapore have lots to lose that is why they Invest and Hire Bloggers to try and discredit the Project but hide behind pseudonym’s and scared to reveal their true identities. Laughable….Nothing New here then….

    • Avatar

      Rinky Stingpiece

      Saturday, September 12, 2020 at 11:37 am

      I’ve changed my mind Tony, I agree with you completely, it’s a brilliant idea.

      • Avatar

        Tony Restall

        Saturday, September 12, 2020 at 12:34 pm

        Pity the Thaigher are only publishing selective comments and editing out replies and responses to ‘BAIT’ as you say the dialogue?

    • Avatar

      Issan John

      Saturday, September 19, 2020 at 2:48 pm

      OMG! So if anyone disagrees with the self-styled “Mr Free Zone” they’re a “Hired Blogger” working for Malaysia or Singapore”!!!

  10. Avatar

    Tony Restall

    Saturday, September 12, 2020 at 12:45 pm

    I see there are two versions of this debate – One Online here and the other via the Thaigher Facebook Page – Pity they couldn’t be coordinated. Seems we are all arguing about the same points.??

You must be logged in to post a comment Login

Leave a Reply

If you have story ideas, a restaurant to review, an event to cover or an issue to discuss, contact The Thaiger editorial staff.

Follow Thaiger by email:

Chiang Mai2 mins ago

Cyclist unable to take steep hill plunges to his death in Chiang Mai ravine

Thailand9 mins ago

Thaiger Bites | The eye of the Thaiger | Ep. 24

Coronavirus (Covid-19)17 mins ago

Thursday Covid Update: 13,256 new cases; provincial totals

Sponsored23 hours ago

HOMA is now offering fully-serviced, affordable lifestyle apartments in Phuket Town.

Welcome back to Thailand!

Thaiger is getting behind local businesses for the restart of tourism in Thailand - up to 50% discounts across all advertising packages!

Pattaya45 mins ago

Pattaya Man goes looking for food, later found dead in graveyard

Phuket1 hour ago

Minor Phuket entry revision: Covid-19 test within 7 days, not 3

News2 hours ago

Grenade attack kills ranger in Pattani

image
Join the conversation on the Thaiger Talk forums today!
Pattaya2 hours ago

Reopening Pattaya: Will it happen next week or not?

Thailand3 hours ago

5 police kiosks set on fire in Bangkok, no injuries reported

Pattaya3 hours ago

Pattaya restaurant busted selling alcohol, 15 arrested

Thailand3 hours ago

Decision on Hua Hin Hospital “dual pricing” case set for next week

Thailand3 hours ago

Morning Top Stories | CCSA says Nov 1 Re-opening possible, Joe Ferrari update | September 23

Thailand4 hours ago

Good Morning Thailand | Is E-sports a real sport? Covid Visas, Joe Ferrari | Ep. 95

Guides4 hours ago

Best VPN services to use in Thailand

Thailand4 hours ago

Lawyer and shaman duo demand police investigate Kanchanaburi temple rehab that allegedly tortured patients

360 Reviews4 hours ago

Top 8 bottled water in Thailand

Morning Top Stories Thailand | Police to end protests, Human Trafficking | September 14 | Thaiger
Thailand1 week ago

Morning Top Stories Thailand | Police to end protests, Human Trafficking | September 14

Thailand7 months ago

Thailand News Today | Thai Airways in rehab, All go for Songkran | March 4

Tourism7 months ago

Phuket’s nightlife. Yes, bars and clubs are still open | VIDEO

Phuket7 months ago

Thailand News Today | Covid passport talks, Thai Airways heads to court | March 2

Tourism7 months ago

Phuket Thai food treats you need to try | VIDEO

Thailand7 months ago

Thailand News Today | Bars, pubs and restaurants ‘sort of’ back to normal | Feb 23

Tourism7 months ago

In search of Cat & Dog Cafés in Phuket Town | VIDEO

Thailand8 months ago

Thailand News Today | Gambling crackdown, Seafood market to reopen, Vlogger challenge | Jan 21

Thailand8 months ago

Thailand News Today | Covid testing for visas, Business impact, Vaccine approval | January 19

Thailand8 months ago

Thailand News Today | Weekend Bangkok bombs, Thailand fires, Covid update | January 18

Thailand8 months ago

Thailand News Today | Stray car on runway, Indonesian quake, 300 baht tourist fee | January 15

Thailand8 months ago

Thailand News Today | Governor off respirator, sex-trafficking arrest, condo prices falling | January 14

Thailand8 months ago

Thailand News Today | Chinese vaccine, Thailand ‘drug hub’, Covid update | January 13

Thailand8 months ago

Thailand News Today | Bangkok may ease restrictions, Phuket bar curfew, Vaccine roll out | January 12

Thailand8 months ago

Thailand News Today | Covid latest, Cockfights closed down, Bryde’s Whale beached | January 11

Trending