Although the Eastern Economic Corridor (EEC) project has been granted numerous privileges, ranging from corporate income tax reductions up to 50% to exemptions for up to 15 years...","tags":["Eastern Economic Corridor","tax incentives","corporate tax"]
These include special rights for long-term land leases and streamlined work permit facilitation through one-stop service centers, among many other benefits offered to foreign investors.
To realize this country's mega projects on a large scale, reminiscent of when General Prem Tinsulanonda, statesman and former Privy Council President and Prime Minister, first ignited the spark of progress, "radiance and prosperity" as when natural gas from the Gulf of Thailand was first harnessed under the Petroleum Authority of Thailand (PTT) along the Rayong coast about 40 to 50 years ago.
However, in reality, the large-scale infrastructure aiming to elevate the three eastern provinces—Chachoengsao, Chonburi, and Rayong—under the Thailand 4.0 policy to become ASEAN's leading economic hub, has stalled. It fits the saying... unable to move forward, unable to reach the goal!
The project has been underway for nearly 10 years but remains stalled due to multiple factors: the government dissolved parliament twice for new elections, the economic climate has been unfavorable for investment, banks have restricted lending, private sector requests to alter conditions, and the government postponed nearly 100 billion baht in incentives.
Additional factors causing delays include insufficient resources, a shortage of skilled labor, land use conflicts with urban planning, environmental concerns, and impacts on local communities.
Nonetheless, the project proceeded through bidding, submission of Terms of Reference (TOR) conditions, investment proposals, benefits to the state, and the project's design, comprising several major investment components.
Yet obstacles remain as private sector winners have sought to change conditions and payment schedules, leading to contract amendments or even complete withdrawal from investment—for instance, the CPH Joint Venture, with Charoen Pokphand Holding as the winning bidder for the high-speed rail connecting three airports.
Now, let's look at the investment components of the EEC project.
The winners of the four major infrastructure projects have already signed contracts with the government, as follows.
1. High-speed rail linking three airports (Don Mueang-Suvarnabhumi-U-Tapao): the winning bidder is the CPH Joint Venture, comprising Charoen Pokphand Holding (CP), Italian-Thai Development, Ch. Karnchang, China Railway Construction Corporation, and others, currently operating through its subsidiary Asia Era One Company Limited (however, the project is currently under renegotiation).
2. Development of U-Tapao Airport and Eastern Aviation City: the winning bidder is the BBS Joint Venture, comprising Bangkok Airways (BA), BTS Group Holdings (BTS), and Sino-Thai Engineering and Construction (STEC), formed as U-Tapao International Aviation Company Limited (UTA).
3. Development of Laem Chabang Port Phase 3 (specifically Pier F): the winning bidder is the GPC Joint Venture, including Gulf Energy Development (GULF), PTT Tank Terminal Company Limited (PTT Tank), and CHEC Overseas Infrastructure Holding, a subsidiary of China Harbour Engineering Company.
4. Development of Map Ta Phut Industrial Port Phase 3: the winning bidder is the Gulf and PTT Tank Joint Venture, comprising Gulf Energy Development (GULF) and PTT Tank Terminal Company Limited (PTT Tank), established as Gulf MTP LNG Terminal Company Limited (GMTP).
These four investment projects initially total approximately 650 billion baht, not including additional investments by SMEs and supporting businesses that will follow in a chain effect.
Meanwhile, Prachinburi Province has been invited to join as the fourth province after studies found it highly suitable and likely to develop industry and urban areas.
Besides new investments, existing investments can be upgraded to new green industries, as well as promote growth in high-value service sectors such as elderly care, health, medical services, and quality tourism, with combined investment in these four provinces expected to reach one trillion baht.
However, as the project stalls with numerous unresolved problems preventing success, Prime Minister Anutin Charnvirakul has taken direct oversight. The government now appears likely to cancel the original bidding and reopen the process to thoroughly examine and resolve all related issues, rather than amending contracts individually. Otherwise, amending one contract would require changes for the others, leading to endless criticism.