Investment / logistics

Chatrudee Theparat

Logistics cost to economy planned to cut to 11% by 2026

The government plans to cut logistics cost to 11% of gross domestic products (GDP) by 2026 as the final year of the 13th National Economic and Social development plan, down from 13.8% in 2021.

Danucha Pichayanan, secretary-general of the National Economic and Social Development Council (NESDC)

Danucha Pichayanan, secretary-general of the National Economic and Social Development Council (NESDC) said the agency has given more importance to logistics development between 2023 to 2027 by cutting logistics cost to 11 % to GDP. Under the plan, it will focus on fives topics, which include infrastructure and facilities development, upgrading standard and value of supply chain, facilitating customs procedures both import and export, improving Thai logistics performance and promoting research & innovation among local entrepreneurs in the field.

Logistics costs in 2021 accounted for 14% of GDP, or 2.23 trillion baht, which increased by 1.8% from economic recovery after the government started relaxing restriction on Covid-19 control measures and promoting economic stimulus measures.

He said logistics cost to GDP this year is likely to be improved to 12.9-13.3% to GDP.

Mr Danucha said the logistics development is defined to be in line with the 13th National Economic and Social Development Plan, which spans from 2023 to 2027, with an aim to transform the country from natural resource-based industries into a knowledge-based or high value-added economy with environmentally-friendly basis.

The Logistics Development Committee, chaired by Deputy Prime Minister Supattanapong Punmeechaow last week, also took a closer look at the second phase 365 kilometres of the Thai-Sino high-speed railway project from Nakhon Ratchasima to Nong Khai, worth 300 billion-baht investment.

Mr Danucha said the transport ministry will propose the cabinet to approve the second phase this December. The project is expected to be in operation by 2028.

The ministry reported to the committee that it is in negotiations with Lao government over an investment in another bridge across the Khong River from Nongkhai to link between Thai-Sino high speed railway and Laos high speed railway in Vientiane. Its investment budget will be shared by the three parties- Thailand, Laos and China- while the investment model of financial contribution will be finalized later.

The Thai-Sino high-speed train project covers 253 kilometre from Bangkok to Nakhon Ratchasima in the northeast region is under construction.

The ministry also reported the committee on a 167 km double track railway from Khon Kaen to Nongkhai, costing 29.7 billion baht. The project will be submitted to the cabinet soon for consideration. The State Railway of Thailand (SRT) board approved its construction plan in December last year.

He said the two projects, worth more than 300 billion in combination, will play a significant role in helping spur Thai economy if construction starts next year.