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Doubt over high-speed rail plan's sustainability

Marc Spiegel

Marc Spiegel

A HIGH-SPEED rail network is necessary for Thailand if the country wants to sustain its economic growth over the long term, but there is "a big question mark" over the project's financial sustainability.

This is the view of Marc Spiegel, regional managing director of Vinarco International, a leading provider of technical consultancy services.

Spiegel, who is also president of the Thai-Finnish Chamber of Commerce and vice chairman of the Joint Foreign Chambers of Commerce in Thailand, told The Nation in an exclusive interview that to capture the opportunities from the government's recently announced Bt2-trillion high-speed rail and other mega-infrastructure projects in the region, Vinarco had asked him to help it launch a new infrastructure and railway division in September.

This adds to the company's existing services for the oil and gas, power, and ICT and telecommunications sectors.

High-speed rail is a specialised industry that requires highly skilled people, who are very hard to find in Thailand. "If Thailand undertakes the high-speed rail project, there are no qualified Thais," the Vinarco executive said, adding that Prime Minister Yingluck Shinawatra was quoted as saying recently that the Kingdom would need 100,000 people to build its high-speed railway network.

However, according to a recent report from the Transport Ministry, the actual number needed to execute all of the projects in the Bt2-trillion infrastructure programme is more than 290,000, and a lot of the top-level expertise will need to come from abroad in order to fulfil all of the project requirements, he said.

Spiegel said a high-speed rail network would provide huge opportunities for the Thai economy to expand further, since it would help the country to develop its regional economies - as Bangkok has become very congested.

"Compared to other big cities where 25 per cent of the area is allocated to land transport, Bangkok only has 8 per cent. While the number of cars is growing, the city has reached a limit. If Thailand wants to grow for the long term, we must build its regional cities," he added.

Nevertheless, Spiegel said that as he had seen the government's high-speed rail plan so far, there was a big question mark over the issue of how to sustain the project over the long-term, as the fares charged were unlikely to cover the service's operating and maintenance costs.

This is because the fares cannot be pitched too high, or many Thais would be unable to afford to use the trains. Moreover, if there were too few passengers using the trains, then the objective of urbanising the country would not be met, he explained.

The French experience

Thailand could learn from France, which has a similar population size and geography, he said.

Despite its world-famous TGV high-speed trains and after more than 30 years of development, high-speed rail still represents less than 20 per cent of travellers and only 1,900 kilometres out of a total of around 30,000km of track in France, where the majority of travellers still have to use regular lines, according to a report in The Guardian.

Spiegel said Thailand's planned high-speed rail system was also crucial to China's ambitious plan to expand its extensive rail network to reach Malaysia and Singapore.

"It's a big problem [for China] if the Thai government doesn't release the [high-speed rail part of the] Bt2-trillion budget. Thailand is a hub in a wheel. The main spoke comes from Kunming [in Southern China]," he added.

Commenting on the Kingdom's current political problems, Spiegel - who has lived here for five years and witnessed the country's bloody "red-shirt" protests in 2010 - said there now seemed to be more divisions in the country than in the past.

"It has split now into so many groups. Like cracks in the wall, the more cracks you have, it's harder to put it back [together]," he said.

A native of Brooklyn, New York, Spiegel has spent the past 10 years working in Asia and plans to remain in Thailand permanently.


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