Developing Thailand's Rail System to Connect EEC and China
September, 27 2021
At present, sea and road transport are the primary modes of cargo transportation between Thailand’s Eastern Economic Corridor (EEC) and China due to limited rail infrastructure. Most railway routes are single-track lines, which restrict capacity and efficiency.
A double-track railway is currently under study and bidding preparation for the Khon Kaen–Nong Khai–Vientiane route, while a private operator is being selected for the Laem Chabang–Nong Khai freight line, with expected operations by 2026. Meanwhile, the Bangkok–Nakhon Ratchasima high-speed railway is under construction, and the Nakhon Ratchasima–Nong Khai–Vientiane section is in the design phase, projected to be operational between 2029 and 2032.
Connecting with the Laos-China Railway
The launch of the Laos-China railway presents an opportunity for Thailand to enhance its domestic rail system to link with China, particularly for freight transportation between EEC and China.
The Laos-China Railway, part of China’s Belt and Road Initiative (BRI), officially opened on December 2, 2021. This railway connects Vientiane, Laos, with Kunming, China, facilitating faster and more cost-efficient passenger and freight transport, thus boosting trade and investment.
Key Export Products on This Route
- Electronics and electrical appliances
- Agricultural products, such as durian, longan, and mangosteen
Benefits of Connecting EEC with China by Rail
1. Lower Transport Costs
- Transport costs per ton can be reduced by 32% to over 50%, depending on the transport mode.
- Truck transport: Cost reduction of 32%
- Single-track and double-track rail: Cost reduction of over 40%
- High-speed rail (same gauge as China’s system): Cost reduction of over 50%
- Rail transport is significantly faster, taking 0.5 to 1.5 days, compared to 2–3 days by road and 5–7 days by sea.
2. New Trade Routes to China and Europe
- More transport options to China and beyond to Europe, using the expanding China-Europe Silk Road rail network.
- Rail transport to Europe takes only 15 days, which is twice as fast as sea freight.
- Vietnam has already launched a Hanoi–Belgium freight rail service on this route.
- Less risk of supply chain disruptions due to COVID-19-related delays in sea freight.
3. Attracting More Investment in EEC
- Enhanced logistics capacity at lower costs will make EEC more attractive for foreign investment.
4. Strengthening Thailand as ASEAN’s Logistics Hub
- Accelerating the development of Thailand’s rail system to connect with the Laos-China railway will position Thailand as a regional logistics hub.
- Expediting related railway projects will ensure faster implementation.
- Upgrading customs clearance systems to support seamless cross-border trade.
By developing its railway infrastructure, Thailand can enhance trade connectivity with China and Europe, reduce costs, and boost economic competitiveness in the ASEAN region.