Thailand’s U-Tapao project is on hold as political uncertainty slows government approval of revised plans for the airport’s long-term expansion in the Eastern Economic Corridor.
Thailand’s U-Tapao project has been temporarily suspended as political deadlock delays a government decision on revised plans for the strategic airport in the Eastern Economic Corridor.
Why the plan is paused
Puttipong Prasarttong-Osoth, president of Bangkok Airways and a shareholder in U-Tapao International Aviation Co. Ltd (UTA), said changing politics are slowing the approval process for the new development proposal.
UTA has asked the Eastern Economic Corridor authorities for one more month to review and adjust the project so it better matches realistic passenger growth trends. There is still no clarity on when the issue will reach the new cabinet.
Puttipong warned that if the government does not approve the proposed changes, the company would have to cancel the contract and seek a refund of more than 4 billion baht already invested in the project.
The railway dispute
One major point of disagreement is whether the U-Tapao project should remain tied to the high-speed rail link connecting Don Mueang, Suvarnabhumi and U-Tapao.
UTA argues that airport development should not be blocked by delays to the rail project. The company wants the airport work to move forward on its own timetable.
Smaller first phase, bigger long-term target
UTA also wants the first-phase terminal plan changed. The original concept called for a terminal built for 12 million passengers, but the airport currently handles only about 400,000 passengers a year.
The company proposes starting with a 3 million passenger terminal and expanding later as demand grows. Over the 50-year concession period, the U-Tapao project would then be developed step by step until capacity reaches 60 million passengers a year.
What investors want
UTA has also asked for a package of private-sector incentives, including tax breaks, simpler licensing for food and alcohol outlets, and faster work permit procedures for foreigners.
The company says these changes are necessary if the U-Tapao project is to compete effectively with other aviation hubs in Asia.
The project remains a key part of the EEC plan to turn eastern Thailand into a modern logistics, aviation and industrial centre, but the current impasse is testing investor patience.
