Thai firms gearing up for mega-projects

Thai firms gearing up for mega-projects
Published: 07 January 2010

Construction firms have set aside working capital, made internal improvements and implemented material-price management in preparation for bidding on large-scale infrastructure projects this year.

The projects, including mass-transit electric-train lines and construction jobs under the Thai Khemkhaeng (TKK) scheme, are good news for a construction industry still hurting from the economic downturn.

The improving economy, boosted by stimulus projects to be launched this year, will lift the industry’s work volume to the highest level in five years, said Plew Trivisvavet, mananging director of  CH Karnchang managing director – one of Thailand’s largest construction firms.

Bidding for many construction mega-projects has been delayed for more than five years by political turmoil. The government now needs to restore the local economy by launching both stimulus schemes and the delayed mass-transit electric-train projects, he said.

Bidding for the delayed projects is expected to open this year.

Ch Karnchang is one company that has prepared its resources to bid for more mass-transit jobs. It hopes the mega-projects will raise its backlog to Bt50 billion this year, from the present level of Bt20 billion.

Domestic contracts are expected to come mainly from the government’s mass-transit rail projects and road construction. Bidders for these mega-projects must prepare working capital for the construction jobs, in order to avoid shortages of finance.

"We’ve proposed an increase in registered capital for the company’s board to approve. Raising funds will strengthen the company’s capital structure," he said.

Siam City Cement expects this year’s cement demand to increase 5-10 per cent from last year’s 25Mt, thanks to big projects like the electric-train lines and road construction under the TKK scheme, said Chantana Sukumanont, executive vice president for marketing and sales.

The start of construction on the Purple Line will help drive cement consumption, as well as road construction and irrigation works, she said.