Study to be Made on High Costs of Thailand-China Rail Project

BANGKOK, Dec 20 (TNA) - A team of engineers will be set up to study the construction costs of Thailand-China rail project in which many say that the total costs at 530 billion baht are “too high”, said Thai Transport Minister Arkhom Termpittayapaisith. Previous study on the construction costs conducted by the Thai side was estimated at between 300 – 400 billion baht, said Mr. Arkhom, adding that construction costs of the rail project could be lower than 530 billion baht after the complete of feasibility study. The Chinese government has earlier informed the Thai side that part of the high construction costs is due to daily minimum wage of workers which would be 800 baht while Mr. Arkhom argued that the wage must adhere to the Thai labour law which is much lower than 800 baht a day. Interest rate to be charged by the Chinese government at 2.5 per cent on the project is also considered too high as the Thai government insists that it should be at the maximum 2 per cent, Mr. Arkhom said. It is expected that the upcoming 10th meeting between officials of the two countries in Beijing would confer on the interest problem, he said. If the Chinese officials insist on the 2.5 per cent interest to be charged on the project at the Beijing meeting, the Thai government may have to borrow from Thai financial institutions as it believes that they would have enough liquidity. Touching on a Thailand-Japan high-speed train project in which the Japanese side reiterated that designs on its rail system must be separated from other rail systems, both the Transport Ministry and the State Railway of Thailand have insisted that the construction must be made in Thailand and, therefore, the control system must follow specifications fixed by the Thai government. The solution to this problem is expected to be arrived at a meeting to be held in future. (TNA)