$17.9bn Thai shipping canal project revived
01 JULY 2001
Thailand's long-delayed mega project to cut a 102-km shipping canal through the Isthmus of Kra in the south to serve as an alternative shipping route to the Malacca Straits has been revived.
The canal is estimated to cost 810 billion baht ($17.95 billion).
Deputy Prime Minister Pitak Intrawithyanunt said a one billion baht ($22 million) feasibility study on the project has been approved by a Cabinet committee, and would be funded by international organisations.
The 18-month study would determine if digging the canal was financially viable and whether the likely enormous political, social and environmental impacts could be mitigated.
The committee conducting the feasibility study would be headed by Deputy Prime Minister Chavalit Yongchaiyudh. It also has the support of the Communications Ministry, as well as backers in the opposition Democrat Party.
However, the project is being opposed by the National Economic and Social Development Board and the Budget Bureau, both of which believe the project is not financially viable.
Pitak said that likely donors for the study were Japan's Global Infrastructure Fund, the Indochina Development Agency, the Sino-Thai Friendship Association, and the Asian Development Bank.
Analysts said the canal, to be dug across the Isthmus of Kra to link the Gulf of Thailand with the Andaman Sea, would position Thailand as a shipping rival to Singapore port.
They pointed out that Malacca Straits was becoming congested, and was prone to accidents and acts of piracy.
Earlier governments had waxed and waned in their support for the canal. It never got off the ground because of a political backlash and fears it would have an adverse impact on the environment.
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