Asia/Pacific News
Thailand and China Deny Deal on Building Kra Canal to Bypass Singapore
Senior government officials in Thailand Tuesday denied reports that the country has signed an agreement with China to construct a shipping canal through the Kra Isthmus that would allow ships to bypass Singapore, Channel NewsAsia reports.
Hong Lei, spokesman for China's foreign ministry, also denied the reports, saying there are no plans by the Chinese government to participate in the Kra Canal's development, the Strait Times reports.
The project would allow ships to access the Gulf of Thailand from the Indian Ocean, bypassing the Straits of Malacca and Singapore.
Earlier in the week, Chinese media reports said that Thai and Chinese governments had signed a memorandum of understanding in Guangzhou to construct the 102 km long canal that would take a decade to complete at an estimated cost of $28 billion.
Panitan Wattanayagorn, security advisor to the Thai deputy prime minister, said that the inaccurate reports from China might have been a result of a misunderstanding.
On Wednesday, a Thai government source is said to have stated, "it is unlikely for Thailand to agree on the project because we are concerned about national security,"
"It is unlikely for the Kra Canal project to be materialised anytime soon," the source added.
In recent years Singapore has lost its title as the world's busiest container port to China's Shanghai port, but it is still by far the world's biggest bunker market by volume and the implications for Singapore of any such canal could be significant.
However industry experts say that, if it were to be constructed, it would take time for Singapore to feel any economic impact.
"Distance is important but ships have to consider services and facilities as well," said Dr Li Zhenfu from Dalian Maritime University.
"The foundation and reputation that Singapore's port has built up cannot be replicated immediately.
Any such more by China would also have significant political and bilateral implications.
"China will have to consider the feedback from countries such as Singapore, which it has friendly ties with, given the impact that the Kra canal might have," said Dr Zhao Hong from Singapore's Institute of Southeast Asian Studies.
