An attempt by China to avoid having to send its shipping through the narrow waters of the Malacca Strait by building a canal through Thailand has come to an end, for now. Facing internal protests, on Sept. 3 the Thai government put the project on hold.
The Thai canal is not a new proposal—in the past, the British, Japanese, and French have wanted to build the canal cutting through the skinniest portion of the Malay peninsula, starting at the Isthmus of Kra. Plans have been made since 1677 when King Ramathibodi III asked French engineers to check its viability.
The Chinese were pushing the Thai administration for it, under their one belt one road (BRI) project, aiming to build a bypass to the Strait of Malacca, which bears almost half of the world’s total seaborne trade.
Chinese analysts see the canal as a means to ensure energy security for China “by reducing the need for Chinese-flagged oil tankers to transit through the Malacca Straits which was ‘controlled’ by the United States,” said a paper by Ian Storey, a Senior Fellow and Editor of Contemporary Southeast Asia at the ISEAS–Yusof Ishak Institute.
Keeping in mind the domestic, economic, and geopolitical factors, Prime Minister Prayut Chan-ocha was cautious in responding to the project, said Storey.
Professor Bogdan J. Góralczyk, Poland’s Former Ambassador to Thailand told The Epoch Times in an email that Chan-ocha had asked for a new feasibility study of the canal in January and a discussion in the national assembly was also happening. Some generals and representatives for Southern Thailand were pressing for the investment.
“China was intended to include the Kra Canal into its BRI vision, combining it with some investments in Myanmar and the Indian Ocean (e.g. a deep-sea port in Khawpheu),” said Prof. Góralczyk who is also the director of the Centre for Europe, University of Warsaw.
He added that while diplomatic talks on the project were happening between China and Thailand, the coronavirus had lessened the value of the project. However, in the past few weeks, the canal was more in the news because of the increasing tensions between India and China.
After the conflict on June 15 in Galwan in which 20 Indian soldiers and an unknown number of Chinese soldiers lost their lives, India deployed frontline vessels along the Strait of Malacca, and the Indian media started talking about how the Thai canal would become a strategic and economic asset for China in the Indo-pacific.
During this time intense protests from the Thai opposition Pheu Thai Party and the public, which were fueled by concerns that the 75 miles mega project will threaten the sovereignty of Myanmar and Cambodia and increase Chinese interference in the region, pushed the Thai government to scrap the project on Sept. 3, reported Asia News.
Thailand simultaneously also stepped back from the purchase of two Yuan-class S26T submarines from China worth $724 million.
Ted Malloch, the author of “Trump’s World: Geo Deus” and many other books, told The Epoch Times in an email that “lucre” would have been a good reason for the Thai canal project.
“That one country and/or its financial institutions (state-backed or not) would try to finance big infrastructure projects like some latter-day Cecil Rhodes can only be objectionable if the appropriate measures of consent and respect for national sovereignty are not part of the package,” said Malloch, referring to China.
“China’s record so far is quite pushy, both on the project finance side and in the wider diplomatic disputes–even with countries like Thailand who are essential to this kind of project’s long term future,” he added.
Shankari Sundararaman, associate professor and expert on Southeast Asian Studies at Jawaharlal Nehru University, New Delhi, told The Epoch Times in an email that it would be “premature” to think that the canal project is completely scrapped.
“The current political situation in Thailand is not conducive to any mega billion-dollar deals. Both the submarine project and this canal are on hold,” said Sundararaman.
Thailand’s Minister of Transport Saksiam Chidchob last month said the Thai government is instead planning to build a land passageway that would connect two ports, one each on the Gulf of Thailand and the Arabain sea. Saksiam said a $3.3 million study has been approved to study the bridge’s feasibility, reported the Thailand Construction News.
The Epoch Times reached out to the Government of Thailand for a statement on the decision but is yet to get a reply.
While feasibility studies like this on the canal have been conducted multiple times in the last few centuries, Thailand’s politics amid growing public unrest and the geopolitical situation vis-a-vis China and the United States in the Indo-Pacific give it new meaning.
Thailand’s Internal Politics
Sundararaman said the Thai canal project was supported by former prime minister Thaksin Shinawatra, who was thinking of converting the major cities around the canal into major ports like Singapore.
“However, with the opposition to Shinawatra’s brand of politics, in the aftermath of the 2006 coup d’etat in Thailand, the potential support for the canal reduced,” said Sundararaman adding that the current King Maha Vajiralongkorn has “ostensibly” supported the project’s revival.
“Rather than seeing it as China’s ability to intervene in Thai politics, it needs to be understood that Thai politics and crony capitalism are closely interlinked leading to conglomerates pressing for the Kra canal project. The current King Maha Vajiralongkorn has recently been trying his best to get greater leverage over some projects, and the Kra canal could well be one of them,” she said.
Chan-ocha has on the other hand gone on record to say that there’s no possibility for the project going forward.
“However, if the King continues to push ahead on the basis of the business conglomerates it may lead to further political instability in the country where there is already a demand for change,” said Sundararaman.
The New Delhi expert said the opposition to the project in the country came from those who worry about the environmental degradation around the canal, while the supporters have said that the advantages of the project outweigh its disadvantages.
“The actual threat would be to Thai sovereignty and the issues of strategic autonomy that each state must protect. The BRI is not merely an economic issue but had grave geopolitical implications that will impact small and medium countries far more than others,” she said.
Malloch said he has visited Thailand multiple times as a diplomat and he greatly admires the country and its people.
“The last thing I would want is to have it ruined or overrun by the malevolent mercantilist and totalitarian one-party state of the CCP,” he said.
Malloch said that if the Thai canal would have been agreed upon it would have lead to the Chinese navy battlegroup spilling across Thailand into the Indian ocean.
“If you want the great … balance of power angle, Bhutan, and Nepal are the only buffer states between China and India right now. There are problems there, but the strategic logic–la raison d’état–of those buffer states is to oblige either power to invade a neutral country on their way across the Himalayas,” said Malloch.
He said if the canal was built, it would have created a third buffer between India and China on the maritime frontier the way the other two exist along with the enormous Himalayan mountain range.
Sundararaman said the geopolitical shifts happening in the region have created a singular maritime system out of the Indian and Pacific oceans, and the Thai canal needs to be seen in this context.
“The reason for this new approach is that since the end of the second world war the U.S. has been one of the predominant powers in the larger system-level analysis–which refers to the global order per se,” she said referring to the free and open Indo-Pacific strategy that the U.S. issued in 2017.
She said that the continued dominance of the United States in the global order is now challenged by China.
“What is more disconcerting is that as China rises, its approach to the international system and adherence to the rule of law seems to be shifting too–especially evident in the South China Sea where China has been involved in the building of artificial islands and claiming its historical rights to the region, affecting the rights of other regional countries under international law,” she said adding that the United States and its allies are also keen to maintain the normative order.
“Particularly the questions of ‘freedom of navigation’ and the ‘respect for sovereignty,’ which puts stresses on all the regional countries. It would be imperative for the U.S. and its allies to address the divergences among the various players to find a more viable approach for the Indo-Pacific,” she said.
Threat to Singapore
Malloch said the canal if built would serve a severe blow to the economic and geopolitical relevance of Singapore.
“I’d be remiss not to mention Singapore again, they play the role in ASEAN that Luxembourg does in the European Union, they’re in charge of keeping the long-term goals in line–Singapore is better at it than Luxembourg,” said Malloch.
“Insofar as this canal weakens Singapore, that could be a net negative for American interests and the interests of the democracies of the region. There are many members of the budding alliance of democracies who would be affected if this canal was built,” he added.
Malloch believes that the Thai canal would also be a blow to Singapore’s customs revenue since it would have created a shorter route to the Malacca Strait at whose tip it is located.
The Malacca Strait and Singapore, together create the world’s most important “shipping waterways” from an economic and geopolitical perspective and are listed in the list of high-risk areas by the Joint War Committee (JWC) of Lloyd’s Market Association (pdf).