KUALA LUMPUR, MALAYSIA – The coronavirus pandemic sweeping the world does not seem to have done much, at least in Laos, to slow down big plans for China for a high speed rail line connecting its landlocked interior to the bustling ports of Singapore via mainland Southeast Asia.
Work crews began laying rails along the first 414-kilometer stretch of the line across the country in March, five years after paving the way. With most of the dozens of tunnels and bridges it will need to cross the mountainous north of Laos now bored and built, state media reported this month that the $ 6 billion project had been completed at 90 %. Service is expected to start by 2022.
Analysts say the full line remains an essential part of Beijing’s Belt and Road initiative. Starting in Kunming, the capital of the Chinese province of Yunnan, it will help the remote region tap into some of the largest economies in Southeast Asia, while strengthening China’s political influence over them in the process.
“Kunming to Singapore rail is a high priority for China. It will allow poor regions of western China, which are now landlocked, to have increased access to the wealthiest parts of South Asia -Is. This will boost trade and tourism, “said Murray Hiebert, senior partner in the Southeast Asia program at the Center for Strategic and International Studies in Washington.
“This would strengthen China’s political influence, but to a limited extent. The countries of Southeast Asia remain concerned about China’s goals,” added Hiebert, author of the next book. Under the shadow of Beijing: China’s challenge in Southeast Asia.
He noted the competing claims of some of them with Beijing in the South China Sea and the Chinese dams that they blame for smothering the Mekong and exacerbating droughts in recent years.
A bird’s-eye view of the planned route would show it meandering through Laos, Thailand and Malaysia before reaching Singapore, hitting the country capitals of Vientiane, Bangkok and Kuala Lumpur along the way.
Great effort for regional influence
“This will give great impetus to China to expand its economic influence [and] to finally dominate continental Southeast Asia; I think it will be a long-term goal, “said Prapat Thapchatree, who heads the ASEAN (Association of Southeast Asian Nations) Studies Center at Thai University in Thammasat.
Laos warmly embraced the project, hoping it will transform one of the poorest countries in Southeast Asia from landlocked to “grounded” and pull new business from a line that promises to send more trade and tourists each way. It will transform what is a three-day slog from Boten on the border of Laos with China to the capital of Vientiane, on its border with Thailand, into a three-hour getaway.
However, potential rewards carry some risk.
A 2018 report from American society Center for Global Development lists Laos among the countries hosting BRI projects that are most exposed to the risk of debt. A more recent BIS debt report by the Lowy Institute of Australia said that Laos owed more of its external debt to China, about 45%, than any of the nine other countries selected for its study. A large part will pay the railroad. The government has borrowed about $ 1.5 billion from the state-owned Export-Import Bank of China to help pay for its 30% stake in the project, according to the Institute for Southeast Asian Studies in Singapore.
Critics of China’s “debt diplomacy” say Beijing is pulling these financial strings for Laos to auction in ASEAN. As a member of the 10-nation bloc, Laos is accused of helping to spoil efforts to mount a united front against Beijing’s sweeping claims in the South China Sea.
“Regionally, China has used Laos as a corner against other ASEAN countries,” said Elliot Brennan, analyst and researcher in Southeast Asia at the Swedish Institute for Security Policy and of development.
The section of the new railway line crossing Laos will be of little use for China if it cannot extend the route to the south, eager to connect with the largest economies in Southeast Asia.
Cautious approach to Thailand
However, Prapat said Thailand and Malaysia are more reluctant to be dragged much further into Chinese orbit and, unlike Laos, have the brunt of being shy and dictating terms.
“Thailand is very careful, very concerned about what happens in Laos and Cambodia, when these two countries are too dependent on China,” he said, comparing them to the de facto provinces of their neighboring giant.
Thailand and Malaysia are also more practical on the project.
“Even after the military coup in 2014, when the Bangkok regime was rejected by many Western governments and China was one of his only friends, the generals played very hard to get because the train the high speed proposed by China was very expensive and not a priority for Thai leaders, “said Hiebert.
Thailand has been cautious in reaching an agreement with China to build the Laos-Bangkok route due to cost concerns, and postponed its intention to sign the contract in December. Malaysia even froze work on its section of line between Thailand and Kuala Lumpur for almost a year and only agreed to restart in April 2019 after convincing China to reduce the initial price by 20 billion dollars about a third.
Analysts say China’s dreams of a high-speed rail line spanning the entire length of mainland Southeast Asia will be even more difficult to sell after the blow that the region’s economies have withdrawn from the pandemic.
Until the line finally arrives in Singapore, said Prapat, “it’s going to be a long way to go.”