Southeast Asia seeking to rise with rail projects + China vs Japan in race

Apr 04, 2017, 09:00 am

By AsiaToday reporter Kim Eun-young - As rail construction and maintenance projects are booming in Southeast Asia, business competition between rail rivals China and Japan is heating up in the region.

The Thai government has made rail development and construction its top transport priority, drawing attention from countries wishing to export their technology. According to the recent report of Singapore's Channel NewsAsia, the most prominent railway project under this government is the railway development project with China, which began in late 2014. This railway will be more than 800 kilometers long and will link the capital Bangkok with the Thai-Laos border of Nong Khai as well as the major deep-sea port in the eastern part of the country. However, the project is being delayed due to the differences in opinion between the two countries, the media reported.

In the meantime, the Thai government is also carrying forward two potential high-speed rail joint-ventures with the Japanese government. One is the Bangkok-Chiang Mai route, and the other is the East-West crossing, both of which are undergoing feasibility studies.

Japanese private companies have already made their presence in Thai's public transport system. Bangkok's Purple Line was launched last year as a result of a joint venture between Thai and Japanese companies. This project was the first overseas project to be carried out by Japan Railway Company, a large railway company that carries 17 million passengers a day in Japan, in partnership with Marubeni and Toshiba. It is expected to be a stepping stone to promote exports of Japanese railway technology in terms of both operation and maintenance.

Under the ambitious plan of China, Laos is constructing a 414-kilometer high-speed railway linking the capital Vientane and the city of Kunming in the southern China within five years. This project is a part of China's "One Belt, One Road" initiative and is likely to meet China's goal of linking Southern Asia, including Singapore, and mainland China, the media said. This project was officially launched with a groundbreaking ceremony in December last year, after a long negotiation and delay in construction.

This project is also significant for Laos. It is expected to overcome the geographic weakness of Laos, the only country in Southeast Asia that is surrounded by land, by increasing the possibility of being fully connected with China and other parts of the country.

"After the railway and highway are completed, connectivity will be facilitating more economic relations, more flow of people and money," said Dr. Leeber Leebouapao from the National Institute of Economic Research. "This will become a trade center for investors, factories, banks."

Indonesia has also teamed up with China. China is expected to begin construction of a 142-km Jakarta-Bandung high-speed rail project in Indonesia soon after more than a year of delay due to the government clearances and local resistance, reported Hong Kong's South China Morning Post (SCMP) on March 25. China won the rail bid over Japan in 2015, and China Development Bank (CDB) committed to support about 75% of the US$5.2 billion needed for the project.

Indonesian State-owned Enterprises Minister Rini Soemarno said on March 21, "The CDB funding would be in place as soon as the plan for the route was signed by Indonesian President Joko Widodo." China Foreign Ministry spokesman Lu Kang also revealed in a recent press conference that the project is proceeding on schedule as a result of joint efforts of both governments and related companies and that he is certain about early completion.

Although Japan lost this bid to China, the country is also making efforts. Indonesia has recently selected Japan as its partner for the maintenance of the Jakarta-Surabaya railway and the feasibility study will be conducted in May, the Jakarta Post reported. The project aims to upgrade the speed of trains between the two cities to higher-speed rail, from around 90 kilometers per hour to 160 kilometers per hour.

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