3. Logistics and industrial infrastructure

This section covers the following topics: ports and waterways, railways, roads, airports, telecommunications and connectivity, industrial and logistics parks.

Summary

• 3.1. Ports and waterways
• 3.2. Railways
• 3.3. Roads
• 3.4. Airports
• 3.5. Telecommunications and connectivity
• 3.6. Industrial and logistics parks

Thailand has defined a development framework consisting of five economic corridors, four of which are newly defined in addition to the first development area called the Eastern Economic Corridor (EEC): the Southern Economic Corridor (SEC), the North-East Economic Corridor (NEEC), the Northern Economic Corridor (NEC) and the Central-West Economic Corridor (CWEC).

• The EEC – Eastern Economic Corridor is tasked with moving Thailand towards a high-tech economy.

• The SEC – Southern Economic Corridor aims to connect the Andaman Sea to the Gulf of Thailand and countries along the Indian Ocean rim such as India, Sri Lanka and Bangladesh. Here Thailand aims to promote the bioeconomy based on palm oil.

• The NEEC – North East Economic Corridor covers the provinces of Udon Thani Thani , Khon Kaen , Nakhon Ratchasima and Nong Khai . It is expected to produce products to supply the EEC and China, focusing on the development of bioeconomy and taking advantage of abundant raw materials such as rice, tapioca and sugarcane.

• The NEC – Northern Economic Corridor covers four northern provinces: Chiang Mai, Lamphun, Lampang and Chiang Rai. It will promote community and cultural tourism and improve export products.

• The CWEC – Central Western Economic Corridor covers Kanchanaburi , Phetchaburi , Samut Prakan, Sakhon and Prachuap Khiri Khan. It will be connected with EEC and Dawei port in Myanmar.

3.1. Ports and waterways

Thailand has a coastline of 3,148 km with over 4,000 km of waterways. The development and management of all major ports in Thailand are under the jurisdiction of the Port Authority of Thailand (PAT), a public corporation under the overall supervision of the Ministry of Transport and Communications.

The main commercial ports are

1. Klong Port Toey is located in the homonymous district of Bangkok, along the Chao River Phraya , between kilometer 26.5 and kilometer 28.5 km from the mouth, for this reason it is also called Bangkok Port. The port can handle about 1.5 million TEU/year, the depth of the river basin is 8.5 meters.

2. Laem Chabang can handle about 11.1 million TEU/year. Currently four piers are operated by private companies. Laem Port Chabang is located in Tungsukhla Subdistrict , Sriracha District and Banglamung Subdistrict of Chon Buri Province . The port covers an area of about 1025 hectares .

3. Sriracha Harbour Deep Seaport was the first port in Thailand to accommodate vessels up to 100,000 deadweight tons. The location of Sriracha Port ensures that it is accessible and fully usable for 95% of the year.

Among the ports of regional importance, Chiang Sean and Chiang Khong , both located in Chiangrai province on the northernmost branch of the Mekong River in Thailand, can collectively handle more than 132,000 tonnes of cargo per year and serve as a base for riverine trade with China, Myanmar and Laos. The port of Ranong , located at the mouth of the Kra Buri River in southern Ranong province , has a 150-metre-long berth that can accommodate one vessel at a time with a deadweight of up to 12,000 tonnes .

Eastern Economic Corridor (EEC ) concern port development, in particular Phase III of the expansion of Laem Port. Chabang , to reach a capacity of 18 million TEU (scheduled for completion in 2027), and the expansion of the industrial port of Map You Phut , with the construction of a new LNG terminal and reaching a capacity of 19 million tonnes of LNG and liquid bulk for the chemical industry (construction is expected to start in 2023 and finish in 2025) ¹.

In the Northern Economic Corridor (SEC ) , discussions are underway to expand the port of Ranong and build a canal across the peninsula, creating a new sea route connecting the Andaman Sea to the Gulf of Siam (or Gulf of Thailand) across the Kra Isthmus.

3.2. Railways

Thailand has a railway network that extends over 4,952 kilometers ², connecting 47 provinces. The network is operated by the State Railway of Thailand (SRT), a state-owned company under the Ministry of Transport.

On 30 April 2021, following the approval of the Council of Ministers on 29 September 2020, SRT Asset was established, with the main objectives of managing and developing the activities of SRT Railways, including the development of the railway network, and of launching Transit -Oriented Development (TOD) projects ³, increasing connectivity and accessibility within the country.

In 2018, about 91% of the network was single-track ⁴, but since 2017 a program has been underway to increase double-track lines, in order to shift air and road traffic to rail: on 28 December 2017, SRT signed nine contracts worth 69.5 billion baht (about 2.15 billion USD) to complete the duplication of tracks on 702 km of the network, while the overall program includes investments of 21 billion USD ⁵.

The first phase of the Expansion Program covers seven sections, two of which have been completed, while the remaining five are under construction. The second phase of the expansion project is scheduled to begin in 2023. In addition, 12 new railway sections are planned for a total distance of 2,419 kilometers, which will bring the number of provinces crossed by the railway to 61.

Thailand is also investing in high-speed rail to improve its rail transportation system. The China-Thailand high- speed line is currently under construction railway between Bangkok and Nong Khai on the border with Laos, with a first phase of investments worth 1.63 billion dollars ⁶.

Among the most significant projects of the Eastern Economic Corridor development program, there is also the development of the high-speed railway that is to connect the three international airports in the Bangkok area (Don Mueang , Suvarnabhumi and U Tapao ) for approximately 6.2 billion dollars ⁷.

3.3. Roads

Thailand has the most extensive road network ⁸in Southeast Asia, with more than 390,026 kilometers, of which 98.5% is asphalt or concrete paved, while 17% is highway.

The network is under the dual responsibility of the Department of Highways (DOH) and the Department of Rural Roads (DORR), under the supervision of the Department of Transportation.

The Department of Highways has developed the 20-year master plan for the development of interurban highways for the period 2017-2036, which includes 21 routes with a total length of 6,612 km. Phase 1, from 2017 to 2026, involves the development of 3,304 kilometers, Phase 2, from 2027 to 2036, involves the development of 3,118 kilometers.

According to the feasibility study ⁹commissioned by the Department of Highways, Phase 1 will see investments of approximately $11.33 billion, Phase 2 of $21.28 billion, for a total of $32.61 billion.

In a macro-regional vision, the new highways that will cross the entire country will become part of the East-West Economic Corridor (EWEC), which will connect the South China Sea with the Bay of Bengal, and the North-South Corridor that will connect Singapore with Kunming in China.

3.4. Airports

Thailand has 38 airports, including seven international ones. Six of them are under the supervision of Airports of Thailand Public Company Limited, they are Bangkok, Samutprakarn , Chiang Mai, Chiang Rai and Phuket, Hat Yai , while U- Tapao International Airport is operated by the Royal Thai Navy ¹⁰.

AOT – Airports of Thailand Public Company Limited is the state-owned enterprise, under the supervision of the Ministry of Transport, that oversees all airports in Thailand.

International services are provided by many carriers, including the country's flag carrier, Thai Airways , which flies to 66 cities in 36 countries worldwide and is part of the Star Alliance network , consisting of 27 airlines, providing an airline network spanning the globe.

Additionally, domestic services are available to all regions of Thailand via both Thai Airways and numerous low-cost carriers. cost .

In 2019, Thai air traffic reached a peak of travelers to Thailand, especially Chinese travelers. Air movements increased from 874,999 to 896,097 flights. The number of passengers increased from 139.52 million to 141.87 million, while the volume of cargo and mail decreased by 10.70%.

The main airports of the Eastern Economic Corridor are U Tapao , Donmuang and Suvanabhumi , the latter, also known as Bangkok International Airport , serves as a regional hub.

Phase 3 of the Suvarnabhumi Airport Development Project , with an investment ¹¹of approximately US$7 billion, aims to increase the annual air traffic movement handling capacity for a number of passengers of no less than 90 million by 2025, through the expansion of the existing terminals and the construction of the Second Passenger Terminal (SAT1) ¹²and the construction of the third Runway (whose expected investment value is US$819 million). Phases Four and Five involve the construction of a Third Passenger Terminal (SAT2) and the fourth Runway, in order to increase the annual air traffic movement handling capacity for a number of passengers of no less than 150 million by 2035.

Tapao International Airport has a standard runway length of 3,500 meters and width of 60 meters with 52 bays. There is currently 1 passenger terminal that can handle 700,000 domestic and international passengers per year, and with the continued expansion of the second passenger terminal, this will increase to 3 million passengers per year. Development plans call for the conversion of nearby brownfield sites to accommodate a second runway, the Aviation Training Center, and utility systems, as well as green space expansions for Phase 1 of the MRO (maintenance, repair and overhaul) campus facilities. The U- Tapao Airport Expansion (expected investment value of US$8 billion) and the MRO campus (US$275 million) are among the six key projects of the Eastern Economic Corridor development because they significantly increase Thailand's capacity to operate in the aviation and marine industry.

Phuket International Airport is the second busiest airport in terms of passenger and cargo volume and is the hub airport for the Southern Economic Corridor. On September 3, 2023, the Bangkok Post reported ¹³that AOT – Airports of Thailand is starting the airport expansion project, which is expected to see the Terminal expansion by 2025, with an investment of approximately $165 million.

3.5. Telecommunications and connectivity

Thailand aims to become a digital infrastructure hub for ASEAN and transform the country into a digital economy. According to the Office of the National Broadcasting and Telecommunications Commission (NBTC), 5G adoption alone could contribute $9.3 billion to the economy, or 10 percent of GDP, in 2035. The Thai government aims to have the digital economy contribute 25 percent of the country’s GDP by 2027 ¹⁴through its economic and social transformation program known as “Thailand Industry 4.0.” The program aims to encourage digital creativity and innovation, the development of new technologies, and promote a digitally driven economy.

The impacts of the COVID-19 pandemic have led to widespread digital adoption in key economic sectors, including retail, manufacturing, transportation, and distribution. This digital adoption will increase demand for Internet of Things ( IoT ) connectivity through mobile networks. Likewise, government policies, including promoting the digital economy, developing smart cities, and allocating 5G frequencies, will ensure that mobile telecommunications infrastructure extends across Thailand, helping to drive greater consumer demand in new parts of the country.

Telecom Public Company Limited (CAT) is the Thai state-owned telecommunications company that owns Thailand's international telecommunications infrastructure, including its international gateways, satellite and submarine cable network connections.

International calls are handled by the Communications Authority of Thailand, which provides direct access to almost all countries.

Telephone Organization of Thailand (TOT) is the only fixed-line operator and has a network of over 2 million telephone lines consisting of modern digital switching equipment and long-distance telephony. Its nationwide services cover basic telephony and value-added services, with fixed-line users numbering 2.48 million in 2020, accounting for 11.48% of households.

In recent years, cell phone ownership has grown at a much faster rate than landline ownership. In 2020, according to the Office of National Broadcasting and Telecommunications Commission , there are 132.59 million mobile subscribers (almost two subscriptions per inhabitant). Mobile operations are performed by the AIS group, DTAC group, True Mobile group, CAT and TOT.

There are 52 million users who regularly use the Internet, equal to 72.7% of the population ¹⁵.

3.6. Industrial and logistics parks

Industrial factories in Thailand are mainly built in areas specially designated for industrial activities, which can be defined as Industrial Parks, Industrial Estates and Industrial Zones.

The terms used for these three types of industrial areas vary depending on the laws and regulations governing the project and the relevant government authorities. For example, Industrial Park is established under the Investment Promotion Act, while Industrial Complex is established under the Industrial Complex Authority of Thailand (IEAT) Act.

The main responsibilities for developers of these 3 types of areas are similar. These include producing an environmental impact assessment before starting to develop the project, developing the project areas in accordance with applicable standards specified by government authorities, and providing a basic public utility system and all other facilities.

Those wishing to purchase land in an Industrial Park, Industrial Complex or Industrial Zone will need to seek approval or authorization from the relevant government sector for any steps deemed related and necessary for the establishment of a business ¹⁶.

As of September 2022, there were 67 industrial estates in Thailand, spread across 16 different provinces and covering a total area of 27,172 hectares, an increase of 0.9% compared to the area occupied in 2021. Of this total, 14 sites are operated by the Industrial Estates Authority of Thailand (IEAT) and the remaining 53 are joint ventures with the private sector. The eastern region is home to the vast majority of the country's industrial estates, with 77.8% of the total (21,133 hectares), followed in importance by the central area (including the Bangkok metropolitan region), which contains another 16% of the total ¹⁷.

In the first nine months of 2022, 77.78% of land in industrial areas had been sold or rented, slightly up from 76.9% in 2021. In terms of investor origin, Japanese operators are, by value of investments (37.4%), the most important foreign operators active in industrial areas, followed by those from China (8.2%) and the United States (6.8%), while by sector, the largest share of territory is occupied by operators from the automotive and transport industry (10.9%), the steel and metals sector (10%), the plastic rubber sector (8.3%) and Mechanics (7.6%).

The cost of land (both lease and purchase) varies from site to site and depends on factors such as location, provision of utilities, access to logistics and transport links, and access to raw materials or industrial inputs. The Bangkok metropolitan area is the most expensive in the country, also dragging down prices in adjacent areas. Space in the Eastern Economic Corridor (in Chonburi , Rayong and Chachoengsao provinces ) is the second most expensive in the country, and in Q3 21, prices rose to a high of US$35,313.79/ha, an increase of about 40% from 2014, before the start of broader government efforts to promote the Corridor.