The Thai government has approved two large-scale projects as well as giving permission to the finance ministry to borrow money from the Export-Import Bank of China (China Exim) to support the projects. The approvals were the last major decisions to be made before the country begins to prepare for its next election to take place at the end of this year.
An agreement was signed between the finance ministry and China Exim, allowing the Chinese bank to lend no more than US$400mn to Thailand in support of the new projects. The loans would require that 50% of the import content for the projects would be from China.
The new projects will entail the construction of two new rail routes, aimed at improving transportation links to the port at Laem Chabang.
Moving goods between the regional depots and Laem Chabang mainly relies on trucks, with trains accounting for an almost negligible proportion of exports.
The new rail routes will help transport more of Thailand’s key export commodities: rice, tapioca starch and sugar.
The other project that might potentially win China Exim support is the planned construction of a new production plant for the Thailand Tobacco Monopoly.