Thailand and Laos agree to continue on railway construction

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BANGKOK, 15 June 2012 – Thailand has agreed to help build a 7.75-km railway worth 1.6 billion baht in Vientiane, Laos, to boost Laos’ economy. 

Madam Viengthong Siphandon, Deputy Minister of Finance of Laos, has signed an agreement with Mr. Acksiri Buranasiri, President of the Neighbouring Countries Economic Development Cooperation Agency; under which the Thai agency will in terms of funding support the construction of the railway 7.75 kilometers long, at the cost of 1.65 billion baht; 30 percent of which is a grant-in-aid worth 495 million baht; the rest, worth 1.15 billion baht, will be a low-interest loan with a ten-year grace period.

The on-going railway construction project, which is aimed at facilitating tourism and business, is scheduled to be finished within 2 years’ time. The track will be of one- meter-wide Meter Gauge system, which could be adjusted to the Standard Gauge of 1.46 meters to accommodate the high-speed rail system planned for the future. The implementation of the project is expected to improve the logistics systems of the two neighboring countries, particularly to and from Ban Ta Na Lang , where Laos’ large godowns which serve as Laos’ nationwide product distribution centers, are located.

Furthermore, the railway will underline the importance of the coming of AEC; given Thai investors will be looking to invest more in Laos, leading to more job opportunities for Thais and higher consumption for Thai products.