Why Thailand's land bridge project is going nowhere?

Thai economists are expressing concern that the government’s much-touted-but-stalled land bridge project will neither be a success nor boost the economy as they hope. Some suggest that the Thai government should first revive existing economic projects left unfinished.

Behind the push

The land bridge project is Thailand’s proposed mega-infrastructure project, which will connect Chumphon province, on the Gulf coast, with Ranong province on the Andaman coast, with a road and rail system for the transport of goods between the two ports.

This project would include the development of deep sea-ports, a 90-kilometre motorway linking the two provinces, a railway system and a pipeline. It aims to shorten the distance for cargo currently using the Strait of Malacca and save about four transit days.

The investment required for the land bridge project is estimated to be a whopping one trillion baht.

Once the construction is complete, each seaport will be able to handle about 20 million cargo containers per year. It is also claimed that the land bridge will boost the local economy to 5% of GDP, creating an economic value of about 500 billion baht each year.

The land bridge project is actually nothing new, because there have been ideas and plans to link the two coasts of the Kra Isthmus since ancient times, particularly during the reign of King Rama IV.

Thai governments in the past decade, from the Prayut Chan-o-cha to the Srettha Thavisin administrations, have tried to push the construction of the project. It has, however, been repeatedly stalled, due to concerns over budget and its environmental impacts.

The project is now being reconsidered, under Anutin Charnvirakul’s leadership, despite not being mentioned in his policy statement to parliament.

The current transport minister, Phiphat Ratchakitprakarn, said that the crisis in the Strait of Hormuz has provided significant impetus for Thailand to develop the project. He said the ministry plans to propose the project to the Cabinet, tentatively in June or July.

Public hearings will take place in this month in both Ranong and Chumphon.

What do the studies say?

According to a study, previously published by the Transport Ministry's Office of Transport and Traffic Policy and Planning, the investment of about one trillion baht would be split into three phases. The investment will be used for the restructuring of the seaports in both Ranong and Chumphon, rail transfer operations, motorways and other railways as part of the land bridge project, as well as the development of commercial areas around it.

The study hopes that the seaports in the two provinces will see over three million cargo containers, or Twenty-foot Equivalent Units (TEU) each, between 2030 and 2031, the first two years of operation. These numbers are expected to multiply to eight million TEUs, with the ultimate goal of 20 million between 2054 and 2079.

It also expects that the local economy in Ranong and Chumphon to expand by 36.3% and 32.8% respectively during the first 10 years of opening. They also hope that the economy in the Southern region will expand by 31.4%, bringing national GDP growth of 5.5%. The land bridge project is also forecast to increase job opportunities to 280,000 in both provinces.

The Thailand Development Research Institute (TDRI) says, however, that the return on investment of the land bridge project looks unrealistic. Thailand’s leading think-tank cited the current Laem Chabang Port in Chonburi province, which recorded only 8.9 million TEUs in 2023, despite being in the eastern region, the biggest hub for trade and industrial manufacturing in the country. It also pointed out that the GDP expectations for the land bridge project are way too high.

Who will invest?

Nonarit Bisonyabut, a senior economist at TDRI, pointed to two reasons why the land bridgeproject remains stalled, the biggest being environmental damage.

As Nonarit explains, the southern region of Thailand is known for its well-preserved natural resources, from beaches, coral reefs and fisheries to local communities that make a living from these. Therefore, the land bridge project has continually triggered massive pushback from local residents.

“We are not sure to what extent this project will damage Thailand’s environment,” he says, while o adding that construction of such massive projects must pass environmental and health impact assessment first.

Apart from this, Thailand’s fiscal situation is already at risk, as the country’s public debt to GDP is now 66%, while its current debt ceiling is capped at 70% of GDP. This means that there won’t be room for the government to borrow more.

“So, what follows is that the government needs to turn it into a PPP (public-private partnership) type of project, where the taxpayer will not put up all the money for the project, but needs to find private sector funding for significant parts of this project,” Nonarit assessed.

Judging from previous projects on such scales, Nonarit feels that the land bridge project will get caught in the same old cycle, like the Southern Seaboard and the Pak Bara Deep Sea Port in the past, where construction gets halfway, but are left unfinished.

“One trillion baht is roughly 5% of GDP. So, if this project fails, then this is just another consumption investment type in Thailand. We have tried to create an economy in the southern region of Thailand and it failed miserably,” according to Nonarit.

Nowhere near

Thailand’s land bridge project already has two major competitors, Malaysia and Singapore.

Malaysia has a similar project, known as the East Coast Rail Link (ECRL), linking the east and west coasts of the country, including its largest seaport, Port Klang. The ECRL, set to start operations in January 2027, is also part of China’s Belt and Road Initiative, giving the country full financial support to complete its construction.

The expansion of Tuas Port in Singapore is already underway, to cope with the increase in cargo ships using the Strait of Malacca. The expansion of the world’s second largest seaport is expected to be complete by 2040.

Looking at the success of these projects, international trade expert, Dr. Aat Pisanwanich, feelsthat Thailand’s land bridge will be an uphill battle. He cited the container capacity of Port Klang, which is 14-16 million TEUs annually. This is higher than the existing Laem Chabang port in Thailand’s Chonburi province at only 11 million.

“Even the existing Laem Chabang Port cannot beat Port Klang. So, what do you expect fromthe seaports in Chumphon and Ranong? How many years will it take for Thailand to be able to compete with Malaysia’s ECRL or Singapore’s Tuas Port? How much does the Thai government need to invest? We are nowhere near these countries,” notes Dr. Aat.

Meanwhile, Thailand’s government spokesperson has claimed that Singapore has expressed interest in the project, during a meeting between Prime Minister Anutin Charnvirakul and Singapore’s Defence Minister Chan Chun Sing at Government House on April 27th. Dr. Aat doesn’t believe, however, that Singapore would be genuinely happy with the project.

“How can Singapore and Malaysia agree [with the land bridge project] when this will threaten their profits?” Dr. Aat pointed out.

“For diplomatic reasons, of course, they would have to say they support the idea. No one would meet the Thai prime minister and say it doesn’t work and Singapore will lose all itsbenefits. Even Malaysia has stayed quiet about this.”

Take a step back

Despite the government’s ambitious plan to revive the land bridge project, both economists agree that the investment simply is not justifiable.

Dr. Aat also feels that the Thai government has a habit of running after the successes of other countries to boost their own national economy. One particular example being the push for the entertainment complex bill during the Paetongtarn Shinawatra administration, citing Singapore’s success with Marina Bay Sands. The proposed project attracted widespread social backlash, eventually leading to the bill’s withdrawal in mid-2025.

Based on this observation, the international trade expert suggests that the Thai government should “step back a bit” and look at the other mega-projects that are left unfinished, namely its high-speed train project linking Thailand, Laos and China, and the development of economic corridors in the eastern and southern regions.

In other words, Thailand should at least revive one of those existing economic projects, rather than trying to emulate what other countries are doing or have done.

“If we upgrade these, with road construction, railways and logistics and industrial hubs in these areas, these would already create an economic impact without the need to come up with new projects which would expose us to more financial risk,” Dr. Aat concluded.