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Regional Connectivity & Thailand’s Investment Plans. Dr. Porametee Vimolsiri Deputy Secretary-General National Economic and Social Development Board (NESDB). Tuesday 13 th November 2012, 10.30 AM At St. Regis Bangkok. Agenda. 2. 1. Regional Connectivity and Sub-regional Cooperation.
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Regional Connectivity &Thailand’s Investment Plans Dr. Porametee Vimolsiri Deputy Secretary-General National Economic and Social Development Board (NESDB) Tuesday 13th November 2012, 10.30 AM At St. Regis Bangkok
Agenda 2 1 Regional Connectivity and Sub-regional Cooperation Thailand’s Investment Plans
Regional Connectivity and Sub-Regions Physical Institutional People to People Master Plan on ASEAN Connectivity • Connect economically and socially to mutually benefit from regional cooperation • Ensure trust with neighbors • Narrow development gap • Provide development support in form of equitable development partnerships. • Major Projects : • ASEAN & National Single Window • ASEAN Highway • SKRL • Road and Railway linking Dawei • Information superhighways • ASEAN Power Grid
ASEAN Community: Prospective Advantages from Economic Partnership • Geographically, Thailand is in the center of ASEAN, its location is closeto most ASEAN member countries. • In recent years, ASEAN economic importance for Thailand in terms of trade, investment and tourism,has been increasing. • Trade Liberalization among the member countries of ASEAN, makes ASEAN No.1 export market for Thailand since 2002, and Thailand’s second largest import market since 1997 (only second to Japan). Thailand has had a trade surplus with ASEAN since 1993. • Foreign Direct Investment (FDI) from ASEAN is accounted for 20 percent of total FDI • Number of ASEAN tourists traveling to Thailand is accounted for 30 percent of total foreign tourists (Malaysian tourist is the highest). Shared resources/ trade partnership leads to cost reduction.
Economic Corridor and Special Economic Zone Development Myanmar PR China Kunming Nanning Lao PDR Vietnam Chiang Saen Huaysai Tachilek Mae Sai Chiang Khong Yangon/Thilawa SEZ ChiangRai Vientiane Hue (World Heritage) Nong Khai Lao Bao SEZ Tak Savanh-Seno SEZ Dansavanh Mukdahan UdonThani W E KhonKaen Mawlamyine Dongha (tourism) Danang (Deep Seaport ) Nakornsawan Mekong River ICD Ladkrabang Bangkok Open to Western Markets Aranyaprathet Kanchanaburi Poipet Phnom Penh ESB (Deep Seaport) Southern EconomicCorridor Ho Chi Minh City DaweiSEZ (Deep Seaport) Vungtau (Deep Seaport) Trat KohKong Mekong River Cambodia Thailand Sadao Kota Berdana Kota Putra Malaysia
Key Infrastructure Development connecting to neighboring countries Regional Connectivity Situation Political-Security Community Trilateral Exchange in Traffic Right between Thailand – Laos PDR – China and 4th Mekong River Crossover Bridge ASEAN Economic Community Socio-Cultural Community Border Economy Development • Thai – Laos – China High-speed Train • Train connecting sub-regionSingapore - Kunming Deep Sea Port and Dawei Industrial EstateDevelopment Hat Yai – Sadao Motorway
Thailand’s Opportunities for Industrial Production Base Expansion “Effective Link for ASEAN Connectivity” • The linkage will be an effective link within the region corresponding to "ASEAN Connectivity" • Power up investment opportunities along GMS Southern Economic Corridor • Build up a strong connection between ASEAN countries. New “Logistics Short Cut” of the Region • Distance to India from Vietnam, Thailand and Cambodia through Dawei port could be shorten to 3,500, 2,500 and 3,000 km. reduce from distance through the Strait of Malacca: 4,200, 4,500 and 4,200 km. Dawei 132 km “Distribution Center & Production Base” 300 km • The linkage will profit traders both from Myanmar and Thailand; • Because of the link to ASEAN highway system, Dawei could emerge as a trading hub linking Southeast Asia with the Indian Ocean, the Middle East, Europe and Africa, spurring growth in ASEAN region. • The linkage will attract rising FDI flow into the region and create the most complementary production bases in the region. Source: * DHL Interview in The Nation March 5, 2012, **UNESCAP report Source: Italian-Thai Development LtD and Siam Commercial Bank
Myanmar-Thailand Joint Mechanism Priority Projects Road Railway Port Industrial Estate Power Plant Water Works & Waste Water System Telecom quality of life & community relocation
Agenda 2 1 Regional Connectivity and Sub-regional Cooperation Thailand’s Investment Plans
Thailand’s Regional Perspective Trade & Investment Openness Strategic Location Enhanced Connectivity & Efficient Logistics Competitive Economy Vision: Building Economic Partnership within the Region • (GMS, IMT-GT, • ACMECS, • BIMSTEC) 1 • (ASEAN) • Asia Pacific • ASEAN+3 • ASEAN+6 APEC 2 3 Goal: Strengthening role of Thailand in regional trade and investment Increasing cross border trade and investment from Thailand to neighboring countries up to 15% (Trade) and 10% (Investment) per year Creating supply chain linkages with the region Decreasing domestic and international transaction cost and improve its standard Strategy: To promote Transport and Logistics linkages at subregional level To create Investment and production bases To prepare for ASEAN Community To build economic partnership within the region in HRD and labor movement To Jointly cooperate on preventing of drugs protection, communicable diseases control, terrorism and natural disasters. To promote environmental friendly cooperation activities
Physical-Connectivity Development in Thailand Economic Restructuring Regional Connectivity • Balancing economic structure for quality and sustainable growth Cooperating with countries in the region for economic and social security • Infrastructure and logistics system development • Modernization of information technology and Communications • Economic legal and regulatory reforms • Development of water supply provision capacity • Energy securitization • Develop the network of transportation and logistics • systems under different • regional frameworks • Create standards of service and facilities at the borders • Integrate area-based development plan with neighboring countries
Infrastructure Development Target • Shift the Rank of Thailand’s economic competitiveness to 16th in the IMD ranking • Rank among the world’s top ten countries for the ease of doing business • Reduce logistics costs to be lower than 15% of GDP • Increase the proportion of the Rail transport to 5% • Increase the proportion of the renewable and the alternative energy consumption to the final energy consumption to be at least 19% • Reduce energy import by at least 3% • Interconnect regional supply chains that can facilitate economic development over a period of time • Increase in Thailand’s cross-border trade and direct investment with neighboring countries to reach 15 percent and 10 percent per annual respectively
Financing for Reconstruction and Future Development Plan Infrastructure Sector Development’s Financing Total 72.064 Billion USD Development’s Financing Source More private participation & involvement To upgrade administration of government projects and to stimulate the use of a more innovative private sector’s technology.
Infrastructure Development Transport Energy Telecom Border Town Development Efficiency + Shift Mode + Tackle Impact from Flood Land Transport Network Development Connecting Main Economic Zones & Cities in the Region and GMS • Motorway and highway • Linking with EWEC , NSEC, SEC for economic expansion and AEC • Railways Development Master Plan 2010-2015 (176,808 mil. baht) • Intermodal facility and NSW • High speed Train linking GMS (742,000 mil. baht) • Develop Mass Transit Networks within the capital perimeter
Infrastructure Development : Road and Bridge Projects • Parts of Economic Corridors in Thailand • Expansion of • 2-lane to 4 lane highways • Maintenance. • The 4th Mekong bridge (T-L-PRC) • Under Construction, will be completed in 2013 • Route No. 11 in Lao PDR 82 km. • Under construction, will be • completed in 2014 • Western side of EWEC in Myanmar • Rehabilitation of 18 km. Road (Myawaddy-Kawkareik) • New construction of 28 km. road (Myawaddy-Kawkariek/mountainous area section) • Rehabilitation of 1st Mae Sai bridge Future • Poo Doo – Pak Lai route (L) • Ban Hwouk – MuangKob (L) • Road link new border crossing points at Aranyaprathet (C) • Infrastructure linking Dawei (M) • - Motorway Bang Yai-Kanchanaburi 97 km. : Details design complete. Searching for fund. • - Kanchanaburi-Border 70 km. Preparing for F/S and Detail Design.
Infrastructure Development : Railway Projects Proposed GMS Railways Routes Cost of Construction – R1 (1.09) R2 (5.32) R3 (2.29) R4 (6.28) $billion • Nong Khai – Thanalang (Rail) - Completed Construction 6 km. • Aranyaprathet – Poipet (Rail) – Missing link 6 km. in Thailand, in process for budget allocation. MOU on High Speed Rail SKRL Development
Infrastructure Development: Airport and Port Projects Transport Energy Telecom Border Town Development • Air Transport : • “Suvarnabhumi Airport to become a key airport of the region.” • Improve capacity and quality services to handle a volume traffic of 65 million people/year. • Utilize information and communication technology to enhance to international standard. • Maritime Transport : • “LaemChabang port to be one of major ports in ASEAN.” • Modernize management of LaemChabang Port • Information technology system to be upgraded to “E-Port” with connection with other international ports
Infrastructure Development : Energy Transport Energy Telecom Border Town Development Cooperation with potential neighboring countries • A search for new energy sources both domestic and aboard. Link with Dawei Energy Security for Thailand • Renewable Energy Technology shall be developed.
Infrastructure Development : Telecommunications Transport Energy Telecom Border Town Development • Telecommunications Infrastructure Development • ICT System High speed internet and broadband network National Single Window ICT supporting trade logistics
Infrastructure Development Transport Energy Telecom Border Town Development ChaingKhong Mae Sai • Urban Infrastructure NakhonPhanom • Special Border Economic Zone Mukdahan Mae Sot • Cross Border Facilities Kanchanaburi Aranyaprathet Potential Border Town Urban Utilities SBEZ Facilities & CCA
Thank You for Your Kind Attention www.nesdb.go.th
11th National Economic and Social Development Plan Summary of 6 Development Strategies Creation of quality Human capital and Society • Creation of Justice in Society (Strategy 1) • Creation of Learning Society (Strategy 2) Economic Restructuring 11th Plan • Strengthening of Agriculture sector and food & energy security (Strategy 3) • Restructuring of the economy towards quality growth and sustainability (Strategy 4) • Regional Connectivity (Strategy 5) Management ofNatural Resources • Preparation for effects of Climate Change and Transfer to low-carbon & environmentally friendly society (Strategy 6) Good Governanceand implementation of 11th Plan
Economic Restructuring to Regional Connectivity Economic Restructuring Investment to develop STI, Infrastructure, and Energy security Restructuringof Trade and Investment Sectors Creation of Regional Connectivity • To create linkages in investment, production and value chains in markets with potential • To expand investment abroad • To promote SMEs to have quality growth • To create enabling environment for economic restructuring • To develop infrastructure and logistics system • To secure power supply adequately Subregion Connectivity/Logistics development Supply chain development along economic corridors ASEAN Asia-Pacific Preparation for ASEAN Community, esp. human capital To constructively participate in cooperation frameworks Strengthening of Agriculture sector and food & energy security • To develop national resources as strong production base for agricultural sector • To increase production efficiency and to generate additional value for production chain • To generate food and energy security and to developrenewable energy
Total Area : 204sq km • Location : Taninthayi District • Distance : 132 km from Thai-Myanmar border • 202 km from Kanchanaburi • 342 Km from Bangkok • 472 km from ESB • Investment : approximately 9,000 mil. USD(exclude resettlement cost) • Concession : 60 years + possible extension • Land Lease : Up to 75 years • Full Capacity of Dawei Port (in 2037 est. ) • 200 mil. Ton per year or 14 mil. TEU compared to capacity of LCB port stage II which is 7.7 mil.TEU per year (not include container ports D1, D2, D3) • 100,000 DWTcompared to 80,000 of LCB port • 25-40 meter-depthcompared to 14-16 meter-depth of LCB port Overview of the Project Cooperation • 1st MOU signed in 2008 • Framework Agreement signed in 2010 • Sign 2nd MOU signed in July 2012 • Scope of Cooperation is in process. • Joint Committee and Master plan on Dawei Development will soon be developed.
Corridor Development between Dawei Project and Laem Chabang Seaport 2 3 1 Basic Infrastructures Development in Myanmar e.g. Road and Port Border Development , Trade and Transport Facilitation Domestic Development: Enhance Current Logistics Infrastructure and Economic area
Challenges of Infrastructure Development linking Asia and GMS Sharing of Benefit & Cost Negative Effects Cross Border Movement Private Sector Financing • Urban Vs rural areas • Advance Vs less- develop countries • Managing of the negative effects of infrastructure • management and facilitation of cross border trade and investment • Financing of infrastructure investment and maintenance • Public-private risk sharing Some of Key Measures to Overcome the Challenges • Transform Transport Corridor to Economic Corridor Development • Cross Border Transport Agreement • ASEAN Infrastructure Fund • Public and Private Partnership (PPP)