SEC Bill to be proposed to Cabinet in September, Landbridge auction in 2025
Manager Daily 360 - Deputy Prime Minister and Minister of Transport, Suriya Jungrungreangkit, is pushing for the SEC Bill to be considered by the Cabinet in September. The bill is expected to pass three readings in the House of Representatives by April 2025. Meanwhile, the Landbridge project is expected to finalize the RFP and open for bidding in mid-2025, with the goal of signing contracts by the end of 2025 and commencing service in 2030. It is believed that this project will boost GDP and create more jobs.
Yesterday (June 30), Mr. Suriya revealed the progress of the Landbridge project, stating that after roadshows and gathering feedback from investors in various countries, the project is currently being adjusted to maximize its potential and meet the needs of both investors and local communities. This adjustment is expected to be completed by the third quarter of 2024, before proceeding to the next steps.
Regarding the progress of the Southern Economic Corridor Bill (SEC Bill) to drive the Landbridge project, the Office of Transport and Traffic Policy and Planning (OTP) has submitted a draft to the Ministry of Transport for consideration. The draft will then be presented to the Special Economic Zone Development Policy Committee (SEZDC), who will assign OTP to draft the bill. It is expected that the SEC Bill will be submitted to the Cabinet for approval in the first week of September 2024, before being presented to the Council of State and the House of Representatives for three readings. The bill is expected to pass the House in April 2025 and be published in the Royal Gazette for enforcement.
Mr. Suriya mentioned that the SEC Bill and the establishment of the SEC Office will be carried out in parallel, with completion expected by the second quarter of 2025. The design of the railway and motorway is underway, while the Environmental Impact Assessment (EIA) is expected to be completed in 2025, aligning with the completion of port designs and the Environmental and Health Impact Assessment (EHIA) in 2024, which will be submitted to the Office of Natural Resources and Environmental Policy and Planning (ONEP) in 2025.
The process of selecting private partners is expected to finalize the Request for Proposal (RFP) in 2025, followed by the selection of investors in the third quarter of 2025. The project will then be submitted to the Cabinet for approval in the same year. The signing of contracts with the winning bidders is expected in early 2026.
The construction will be divided into three phases: Phase 1 will start in 2026 and be completed by the end of 2030, Phase 2 will start in 2031 and be completed by the end of 2034, and Phase 3 will start in 2035 and be completed by the end of 2036.
The estimated investment for Phase 1 is 522,844.08 million baht, including deep-sea ports in Chumphon and Ranong, a connecting route between the two ports (railway and motorway), construction of cargo transfer areas, and land expropriation and ownership costs of 6,212.00 million baht.
According to a study by OTP, the Landbridge project is expected to increase Thailand's GDP growth rate from the estimated 4.0% per year by the National Economic and Social Development Council (NESDC) to 5.5% per year. Additionally, it is expected to create 280,000 jobs in the area, with 130,000 jobs in Ranong and 150,000 jobs in Chumphon.
"Dubai Ports World" Advances "Land Bridge" Development Plan, Establishes Joint Working Group with Thailand to Study Feasibility
Source - Manager Online
Friday, July 05, 2024, 08:42
"Prime Minister-Suriya" Discuss with "Dubai Ports World" on Interest in Developing "Land Bridge", Set Up Joint Working Group of 4 Members Each to Study Feasibility for Joint Investment, Expected to Take 4 Months. Confirms It's Just a Cooperation, Steps Awaiting Consolidated Investor Opinions.
A source from the Ministry of Transport revealed that after Prime Minister Srettha Thavisin welcomed Sultan Ahmed Bin Sulayem, Chairman of the Group and Executive of the world's leading logistics and supply chain business, "Dubai Ports World (DP World)" to discuss investment opportunities in Thailand and transforming the country into a regional transportation hub. The discussion was joined by Deputy Prime Minister and Minister of Transport Suriya Juangroongruangkit on July 3, 2024.
DP World has shown significant interest in the transport infrastructure development project for the Southern Economic Corridor (Land Bridge). Initially, both sides agreed to form a joint working group consisting of 4 members from each side to study the feasibility of the joint investment, with an expected study period of about 4 months.
This feasibility study does not mean that Thailand will hand over the Land Bridge project to DP World; it is merely a feasibility study. Other countries, such as China, Japan, and France, are also interested in this project," the source from the Ministry of Transport said.
Previously, Deputy Prime Minister and Minister of Transport Suriya Juangroongruangkit mentioned after a roadshow for the Land Bridge project that he had gathered feedback from foreign investors. The project is currently being adjusted to be most suitable and highly potential to meet the needs of investors and local people. It is expected to be completed by the third quarter of 2024 before proceeding with other processes.
As for the progress of drafting the Southern Economic Corridor Act (SEC Act) to drive the Land Bridge project, the Office of Transport and Traffic Policy and Planning (OTP) has submitted the draft Act to the Ministry of Transport for consideration and proposed it to the Special Economic Zone Development Policy Committee (SEZDC). The OTP is expected to present the SEC Act draft to the Cabinet for approval in the first week of September 2024, for consideration by the House of Representatives. It is expected to pass the House's consideration by April 2025.
Minister Suriya stated that the SEC Act and the establishment of the SEC Office are planned to be completed by the second quarter of 2025. The design of the railway and motorways, including the Environmental Impact Assessment (EIA) report, is expected to be reviewed by the Office of Natural Resources and Environmental Policy and Planning (ONEP) by 2025. This aligns with the design of the ports and the completion of the Environmental and Health Impact Assessment (EHIA) by 2024, which will be submitted to ONEP for review by 2025.
Regarding the private sector selection process, the drafting of the Request for Proposal (RFP) documents for inviting investors to join the project is expected to be completed by 2025, before selecting investors in the third quarter of 2025. The project is expected to be approved by the Cabinet in 2025, with contracts signed with the winning bidder in early 2026. The construction will be divided into three phases: Phase 1 begins in 2026 and is completed by late 2030, Phase 2 begins in 2031 and is completed by late 2034, and Phase 3 begins in 2035 and is completed by late 2036.
'Land Bridge' Is Certain: 'Dubai Port-China-America' Intensively Advancing, Office of Transport and Traffic Policy and Planning Points Out Issues with the Strait of Malacca and Power Conflicts as Supporting Factors
Manager Online
August 5, 2024, 05:49
The Office of Transport and Traffic Policy and Planning (OTP) is confident that the 'Land Bridge' project will happen due to supporting factors like the congested Strait of Malacca and global power conflicts, creating opportunities for new transport routes. Major players like Dubai Port, China, and America have begun their initiatives, with an initial investment phase of 500 billion baht. The project also aims to develop four southern provinces into special economic zones to boost domestic transport capacity. The SEC bill is expected to be submitted to the Cabinet in October, with consultants hired for the RFP process by early 2026.
Panya Chuphanich, Director of the OTP, updated on the progress of the infrastructure development project aimed at connecting the Gulf of Thailand and the Andaman Sea (Chumphon-Ranong) or the Land Bridge project. The OTP has studied the overall data and investment plans and has received significant interest from investors globally, including Dubai Port World (DP World), a global logistics and supply chain giant, whose top executives have visited the site themselves, as well as investors from China and the United States. Recently, on August 1, 2024, Robert F. Godec, the U.S. Ambassador to Thailand, visited the Land Bridge site for the second time, demonstrating significant interest from the United States. Therefore, the OTP is confident that the Land Bridge project will proceed.
Another supporting reason is the necessity of having a port on the Andaman side due to global power conflicts, whereas transportation through the Strait of Malacca, managed by Singapore with American involvement, requires confidence for countries to continue their shipping and business amidst these conflicts.
Moreover, the analysis indicates that two major groups, Dubai Port World and Chinese investors, show great interest. Dubai Port World, having a large fleet but no port of its own in the Strait of Malacca, relies on other ports like Thailand's Laem Chabang Port. Thus, Dubai Port World's interest in the Land Bridge project stems from the need to have its own port to manage its shipping and business. Recently, after Sultan Ahmed Bin Sulayem, Chairman of DP World, discussed with Prime Minister Srettha Thavisin on July 3, 2024, a joint working group was established to explore the feasibility of the investment, with the first meeting being prepared.
For Chinese investors, the Land Bridge will be beneficial as it provides transport routes for imports and exports to the south, complementing their existing rail investments. Additionally, there are major investors from the U.S., Japan, and France, and smaller companies might collaborate to invest.
@In 10 years, the Strait of Malacca will be full, presenting the Land Bridge as an alternative shipping route
When asked if the port developments in Singapore and Malaysia would make the Land Bridge less competitive, Panya stated that port development is not the issue. Currently, Singapore and Malaysia's ports have no problems expanding to accommodate growth. The problem lies with the Strait of Malacca, which, according to studies, will be congested in 10 years, leading to long wait times and increased costs for shipping lines.
"I want to emphasize that Thailand's Land Bridge development is not competing with Singapore and Malaysia's ports but addressing the issue of the congested Strait of Malacca and the reliability concerns of shipping lines passing through amid power conflicts. If conflicts intensify and restrictions are imposed on passing ships, it will impact businesses, and shipping lines will need alternatives, hence the interest in the Land Bridge. The investment will be divided into three phases based on demand, with the first phase costing 500 billion baht, including ports, motorways, railways, and hinterland areas. Major investors see this figure as reasonable, and developing special economic zones in four surrounding provinces will provide opportunities for investors to benefit from the project," Panya said.
@SEC Bill to be proposed in October, 69 articles of law
The OTP is pushing forward the draft Special Economic Zone Development Act (SEC) to drive the Land Bridge project, designating Surat Thani, Nakhon Si Thammarat, Chumphon, and Ranong as special economic zones like the Eastern Economic Corridor (EEC). The draft has been submitted to the Special Economic Zone Development Policy Committee, chaired by Deputy Prime Minister and Finance Minister Pichai Chunhavichir, to authorize the OTP to draft the SEC bill. The committee will meet at the end of August 2024. Once authorized, the OTP will gather public feedback for about a month, adjust the draft accordingly, and present it to the Cabinet by October-November 2024 for legislative processing. The SEC bill is expected to pass both the House of Representatives and the Senate by April 2025.
@Detailed design of 'motorway-railway' to be completed by September 2025
The OTP has completed the conceptual study, confirming the project includes ports on both sides, motorways, and railways connecting the ports. The OTP is conducting environmental and health impact assessments (EHIA) for the ports. The Department of Highways is responsible for the motorway design and environmental impact assessment (EIA), with allocated funds. The State Railway of Thailand (SRT) will design the railway and conduct its EIA. Both motorway and railway designs are expected to be completed by September 2025, aligning with the project's timeline, with tenders expected by the end of 2025 or early 2026.
@Consultant hiring for RFP in September 2024, tender by early 2026
The OTP is hiring consultants for the project to prepare documents and advise on the private sector selection process for the Land Bridge project (RFP). This includes drafting the proposal invitation, selection criteria, and investment contract, along with other necessary documents, with a budget of 45.959 million baht for an 840-day study. The contract signing is expected in September 2024.
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