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15 Nov 2018

Thai Economy

Higher Growth Potential of Public Construction in 2019, Buoyed by Mega Projects (Current Issue No.2937)

           A number of infrastructure projects have exhibited satisfactory progress after the government's announcement of an action plan to expedite large infrastructure investments in 2016-2018 with an important impetus being the Eastern Economic Corridor (EEC) program with THB trillions of investment. Completed construction include the Laem Chabang Port A project and the civil work under the Red Line Mass Transit System while ongoing projects are, for example, seven routes under the Double-Track Rail Project Phase 1, part of Contract No. 1 of the Thai-Chinese High-Speed Train Project (Bangkok-Nakhon Ratchasima), three Mass Transit Rail Projects in Bangkok, namely the Red, Pink and Yellow Lines.

            For 2019, several projects have been approved or will definitely be approved. They consist of EEC-related projects, the Orange and Purple Mass Transit Lines, and the second phase of Double-Track Rail Project (Den Chai-Chiang Rai-Chiang Khong). However, construction will likely start in the second half of 2019 because the bidding projects will take place in the first half-year. In addition, various projects may become more clarified after the general elections.

            KResearch views that such project implementation in 2019 will not be significantly affected by the general elections and a new government's policy, and the bidding processes of the approved projects will continue as planned. Considerable progress is expected for those Mega Projects, thus contributing to the injection of large-scale funding into the economic system under both ongoing and new projects. KResearch estimates that, in 2019, the government's budget disbursement for such Mega Projects will be higher than in 2018, especially in the second half of the year after the general election has been held.​