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Infrastructure & PPPs in Thailand - Q4 2023 Update

YOG INFRA Q4 2023 insights

THAILAND is developing a large number of multimodal logistics projects, with a strong focus on enhancement of transport infrastructure and increasing connectivity with neighbouring countries. Development sectors include motorways, MRT lines, new inter-country rail links, ports, land bridge projects etc. - all of which hold good potential for use of PPP model for implementation.

Read more about key developments in Infrastructure and PPPs in the country in our latest insight.

 

October 2023

IFC TO ASSIST THAILAND FOR INFRA PPPS

Thailand's Ministry of Interior and the International Finance Corporation (IFC) signed a memorandum of understanding (MoU) to strengthen the country's basic infrastructure and wastewater management. The IFC will help the government to identify and prepare public-private partnership projects with an emphasis on sustainable development. The IFC, which is owned by the World Bank, focuses on facilitating private sector investments in emerging markets. 

Some of the potential initiatives comprise subnational financing for projects related to public transport, wastewater treatment, water supply and distribution, and electric vehicles (EVs). Once finalized, IFC will help the selected municipalities assess the viability of the projects and conduct feasibility studies in alignment with international best practices.

 

THAILAND PLANS TENDER FOR USD 27.5 BN LAND BRIDGE PROJECTS 

The Thai government is planning to call for bids on its THB 1 Trn (USD 27.5 Bn) land bridge transport network between April and June 2024. The government will develop the megaproject as a public-private partnership and aims to attract foreign investment through an overseas roadshow. 

The land bridge will include ports development in Ranong and Chumphon and an 89.3 km transport link between the two in the form of a special highway and double-track railway. The ports will have a capacity of 20 Mn twenty-foot equivalent units (TEUs) and will be supported with a government budget allocation for land expropriation.

 

PLANS ANNOUNCED FOR USD 2.86 BN GREEN HYDROGEN PROJECT IN THAILAND 

Ronitron has signed a memorandum of understanding (MoU) with Laos-based AIF Group to develop a TBH 100 Bn (USD 2.86 Bn) green hydrogen production project in Thailand. The project will use advanced Solid Oxide Electrolyzer Cell (SOEC) technology as a renewable energy (RE) source. 

Additionally, the company is working with ATE Company Limited to implement Solid Oxide Electrolyzer Cell (SOEC) solutions aiming for green ammonia production in Laos. Ronitron is also partnering with the Fintech Inno Group of Companies to develop a Carbon Credit Management System.

 

MRTA PUSHES CITY, PHUKET TRANSIT PLANS

The Mass Rapid Transit Authority of Thailand (MRTA) will urge the Transport Ministry to push ahead with 3 mass-transit projects in Bangkok and Phuket based on a total investment of about 220 Bn baht (USD 6.28 Bn). The projects relate to the Orange and Brown lines in Bangkok and a mass-transit project in Phuket.

The Orange Line links the Bang Khun Non area in Bangkok Noi district on the west side of the Chao Phraya River to the Min Buri district of the East of Bangkok. Construction of the Orange Line's western extension has been stalled due to a dispute about the bidding process.

The second project, which still needs to be approved, is the 22.1 km Brown Line electric monorail linking Khae Rai in Nonthaburi to Lam Sali in Bangkok, based on an investment of 49 Bn baht (USD 1.4 Bn) . The MRTA board has already approved a feasibility study, the bidding terms, and an analysis report regarding public-private partnerships (PPP). The MRTA will gather feedback from related agencies on the plan before submitting it to the Transport Ministry.


GOVT TO SET UP NATIONAL SHIPPING LINE

The Transport Ministry is looking to establish a national shipping company in an effort to promote maritime trade. Transport Minister had ordered the Port Authority of Thailand (PAT) to conduct a feasibility study for the cabinet to review. PAT has submitted the result of the study to the Transport Ministry, which will decide if the shipping company should be run as a state enterprise or under a public-private partnership model.

PAT wants to have both domestic and international shipping routes, but it would be focusing on 8 domestic routes. Among the 8, 3 routes are not currently served by private companies, namely

  • Map Ta Phut Port in Rayong-Laem Chabang Port in Chon Buri,

  • Firesun Port in Samut Songkhram-Laem Chabang Port in Chon Buri and

  • Laem Chabang Port in Chon Buri-Surat Thani Port.

 

November 2023 

PLANS ANNOUNCED TO CONSTRUCT NEW ELEVATED TOLLWAYS IN THAILAND 

The Transport Ministry of Thailand announced plans to construct 2 new elevated tollways worth THB 87 Bn (USD 2.49 Bn) by 2028. The first project includes a 22-km-long extension of the Don Mueang tollway, from the Rangsit area in Pathum Thani to the Bang Pa-in district in Ayutthaya. The project is estimated to cost THB 31.28 Bn (USD 894 Mn). The project will be executed through a public-private partnership (PPP) model, where the private sector will bid for the construction and operation and the government will then repay this cost in due course.

The second project involves a 38.85 km-long elevated tollway from the western outer ring road of Bangkok to the Bang Khunthian district and the Bang Bua Thong district in Nonthaburi. The project is estimated to cost THB 56.03 Bn (USD 1.60 Bn).

 

SRT TO CONNECT LAND AND RAIL TRANSPORTATION IN THAILAND

The Department of Land Transport signed a memorandum of understanding (MoU) with the State Railway of Thailand (SRT) to connect land and rail transportation in the country. As per the MoU, the Department of Land Transport will invest in the development of truck terminals to distribute goods across the country, meanwhile, SRT will implement the projects to expand its rail network, including dual-track railway construction and new railway line projects.

The project is expected to reduce logistics costs and facilitate the transportation of goods from Thailand to southern China and Vietnam. Currently, the Department of Land Transport is constructing the Chiang Khong intermodal transport facility in Chiang Rai. The public-private partnership (PPP) is in its second phase. The signing of investment agreements is scheduled to take place in 2024. Additionally, the border logistics and transport centre in Nakhon Phanom is under construction and is expected to commence operations in 2025. Both projects will connect to the SRT’s dual-track railway projects.

 

CHAMBER OF COMMERCE WANTS TO BOOST 10 SECONDARY PROVINCES

The Thai Chamber of Commerce (TCC) has called on the government to speed up developing public infrastructure in 10 second-tier tourism provinces, to boost tourism revenue while promoting them as new primary attractions. The TCC outlined its development plan, where it also hopes to tackle social discrimination, for the 10 provinces which are currently being selected. The plan is part of the five-dimensional economic reform scheme proposed to the government.


BANGKOK CITY AUTHORITY TRANSFERS 3 PROJECTS TO MRTA

THE Bangkok Metropolitan Administration (BMA) is to transfer responsibility for three rail projects with an estimated total cost of Baht 150 Bn (USD 4.3 Bn) to the Mass Rapid Transit Authority (MRTA).The projects are

  • the Grey Line monorail connecting Watcharapol with Thong Lor,

  • the Silver Line light rail transit system linking Bang Na with Suvarnabhumi Airport, and

  • the BTS Skytrain Green Line extension from Bang Wa to Taling Chan.

The BMA has completed studies for the Grey and Silver lines, which are both expected to be taken forward as a public-private partnership (PPP) under a 30-year concession contract. The Green Line extension project is still in the development phase following an earlier value study. A proposal to transfer the 3 Bangkok rail projects will be presented to the Commission for the Management of Road Traffic.

 

December 2023

THAILAND’S MOT TO START WORKS ON 14 INFRASTRUCTURE PROJECTS IN 2024

The Ministry of Transport (MoT) of Thailand will commence construction on 14 infrastructure projects across the country in 2024. These include multiple rail, highway and road projects with a combined cost of THB 570 Bn (USD 16.30 Bn). Some of the key rail projects include

  • The 167-km-long dual-track railroad project between Khon Kaen and Nong Khai at an investment of THB 29.7 Bn (USD 849 Mn),

  • The THB 140 Bn (USD 4 Bn) Orange Line project between Bang Khun Non and Min Buri,

  • The extension of different phases of Red Line at an investment of THB 21.6 Bn (USD 617 Mn).

  • Works will also start on the Nakhon Ratchasima and Nong Khai section of the Thailand-China high-speed rail (HSR).

  • Expansion works on the 4.5 km stretch of Highway 4027 will start in August 2024 and will cost THB 510 Mn (USD 15.43 Mn).

Other road projects that will be undertaken during the year include the construction of elevated roads at the 402, 4027 and 4025 highway junctions. Work on the THB 2 Bn (USD 57 Mn) project is expected to commence in September 2024.

 

EGAT SIGNS PPAS FOR 12 NEW SOLAR PROJECTS IN THAILAND

Gulf Energy Development Public Company Limited and the Electricity Generating Authority of Thailand (EGAT) have signed 25 Power Purchase Agreements (PPAs) for 12 solar projects in the country. These projects include five solar farms with a combined capacity of 259.6 MW and seven solar farms with battery energy storage systems (BESS) with a combined capacity of 385.2 MW. The projects are expected to commence commercial operation between 2026 and 2029.

Additionally, Gulf Energy Development has also signed PPAs for 24 solar power projects with a total contracted capacity of 1,294.1 MW. This includes 13 solar farms and 11 solar farms with BESS, which are expected to commence commercial operations from 2024 to 2029.


JAPANESE INVESTORS EYE RAIL LINE

Japanese investors have expressed interest in investing in Red Line electric train extension projects. Thailand and Japan could collaborate in the development of transportation. The two sides are continuing to work together to develop the connectivity of basic infrastructure in Thailand. Due to the benefits gained from exchanging technical knowledge about various forms of transport, Thailand is delighted Japanese investors are continuing to support transportation projects in the country. This is the key to strengthening related infrastructure and connectivity, as well as boosting bilateral ties.

 

THAILAND SEC IMPLEMENTS NEW ICO REGULATIONS

Thailand's Securities and Exchange Commission (SEC) has updated its regulations regarding public initial coin offerings (ICOs) that exhibit debt-like or infrastructure-backed characteristics. These new regulations are set to transform the landscape for digital fundraising, ensuring enhanced investor protection and risk mitigation.

The introduction of these regulations is a major move toward cultivating a more transparent and secure digital token market in Thailand. It highlights the importance of comprehensive information disclosure and aligning digital-asset fundraising practices with established financial standards. The adjustments require more collaboration between token issuers and ICO portals to comply with the developing regulatory environment.


 

List of key transactions - Thailand Q4 2023



 

ABOUT YOG INFRA

Our objective is to drive economic growth and make positive social impact through sustainable infrastructure development.

​YOG INFRA is an infrastructure focused financial advisory firm. We work with Developers and Development Finance Institutions (DFIs) and help them make informed investment decisions across infrastructure development lifecycle.

With our offices in Singapore, India and UAE, we work on projects globally, and the team brings strong experience in supporting development of infrastructure projects.


For more information about us, our service offerings and team, please visit www.yoginfra.com Contact us at info@yoginfra.com


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