Beyond the Rails Ong Tee Keat

China-Laos railway is a key milestone in the realization of the Pan-Asian Railway Network.

The inauguration of the railway between China and Laos is a key milestone in the realization of the Pan-Asian Railway Network running between Kunming, capital of Yunnan Province in southwest China, and Singapore. The network’s central route, once highly challenging to Laos, is poised to become a catalyst setting in motion the complete system. Stretching along 424 km, the Boten-Vientiane tracks--more commonly referred to as the China-Laos Railway--not only mark the 60th anniversary of bilateral diplomatic ties, but also signify a strident step forward in the relationship between China and the Association of Southeast Asian Nations (ASEAN) amid the 30th anniversary celebration of their dialogue partnership.

The anticipated mass cargo transportation, cross-border tourism, trade cooperation and human interaction stemming from this new rail artery across the China-Laos border, combined with the China-Thailand Railway now under construction, provide a promising prognosis for cooperation under the framework of the Belt and Road Initiative between the neighboring countries. This explains the significance of the Pan-Asian Railway Network in connectivity between China’s southwest and the Southeast Asian mainland.

The benefits would go even further if the Peninsular Malaysia-Singapore link were to be revived given this connection constitutes the final lap of the entire Pan-Asian Railway Network. In the concluding analysis, a complete railway network stands ready to facilitate economic integration on the overarching Southeast Asian mainland, encompassing Viet Nam, Cambodia, Laos, Myanmar, Thailand, Malaysia and Singapore--seven of the 10 ASEAN member states.

A paradigm shift

While naysayers in the West are busy splitting hairs over whether Laos stands to benefit from the project, the China-Laos Railway is virtually transforming the former land-locked country into a land-linked state where enormous changes in the local and regional economic landscape are set to unfold.

On the macro-level, a distinctive paradigm shift in the regional logistic connectivity slowly appears on the horizon. Upon the completion of the entire Pan-Asian Railway Network, the modes of regional logistics are highly likely to branch out from being predominantly sea-borne to railway-borne, as well as adopt a maritime transmodal framework.

This is crucial to both China and its regional neighbors with the inception of the Regional Comprehensive Economic Partnership on January 1, 2022. As of today, 10 out of 15 member states have already completed their respective parliamentary ratification that empowers the free trade agreement to take effect within their borders. Of all 10 ratifying countries, China, Laos, Viet Nam, Cambodia, Thailand and Singapore are the key stakeholders involved in the Pan-Asian Railway Network.

With the biggest ever free trade bloc in the world put into practice, along with the enhanced domestic demand in the Chinese market under the country’s dual circulation economic development pattern, the subsequent escalating demand for logistics cannot solely rely on maritime logistics. And obviously, railway transportation is the most viable alternative--as well as the most befitting long-term solution. In essence, dual circulation, which takes domestic market as the mainstay, with domestic and international markets reinforcing each other, is part of China’s masterplan to become self-reliant in resources, technology and demand with its own huge market and other markets available through Belt and Road Cooperation.

The game-changer

Nonetheless, rail transport has long taken a backseat in regional connectivity.

The three-route Pan-Asian Railway Network has only been in the international spotlight occasionally since October 2006, when 18 Asian and Eurasian countries signed the Trans-Asian Railway Network Agreement, incorporating the Kunming–Singapore railroad into the trans-Asian network. Yet it wasn’t until the inception of the Belt and Road Initiative in 2013 that the ideal of "connectivity" was resurrected from oblivion when it became a buzzword on the roadmap of cooperation between participating countries.

To Southeast Asian countries, infrastructural connectivity is an empowering tool to improve economic competitiveness. Chinese expertise in infrastructural development is a boon to them. Under the Belt and Road Initiative, construction of trans-border tracks, high speed railways and other infrastructure projects in member countries have greatly heightened both domestic as well as trans-border connectivity.

On the other hand, China's forte in railroad development is a powerful means to boost its railway diplomacy, notably vis-à-vis its neighbors in Southeast Asia.

Undeniably, infrastructural connectivity is a "game changer" that can transform an economic backwater into a bustling hub of economic growth. Any assets in infrastructural development merely endear China to its neighbors. Nevertheless, the main impact of its geopolitical influence still finds itself in the dimension of human engagement--people-to-people connectivity also known as one of the five pillars of connectivity underscored in the Belt and Road cooperation blueprint.

The significance of this specific dimension might have been obscured by the various mega projects allocated as landmark initiatives at the nascent stage of Belt and Road cooperation. As the initiative is coming of age, set against a backdrop of escalating geopolitical hostility designed to clip the wings of China's influence, people-to-people connectivity is undoubtedly an appropriate and efficient way to get around any bid intended to drive a wedge between China and its regional neighbors. This matters in the current context of a widening trust-deficit in international relations. Winning the hearts and minds of the people is no less important than initiatives rolled out to improve their economic wellbeing.

Vim and vigor

Before the year draws to a close, the Pan-Asian Railway Network is in the news once again, with its impact rippling well beyond the China-Laos border. The trans-border rail is definitely not going to stop at Vientiane. But instead, intra-ASEAN peer competition might turn out to be a driving force stimulating political will in Bangkok, Kuala Lumpur and Singapore to rekindle the vigor of completing the Thailand and Malaysia-Singapore laps.

After adopting the Pan-Asian Railway Network into the structure of the grand Trans-Asian Railway Network in 2006, goods from Southeast Asia could finally travel into Europe by rail--through China. In retrospect, the trans-Asian network was first introduced by the UN Economic and Social Commission for Asia and the Pacific as the concept of an integrated freight railway network running across Europe and Asia. But unfortunately, at that time, any railway connectivity of this scale remained a distant dream before the advent of the new millennium.

Operation of China-Europe cargo trains only came into being one decade ago, with connectivity traversing a large portion of Europe and Asia. Its success has tremendously inspired Southeast Asian countries as the latter could envision they would be the ultimate beneficiaries should the duly completed Pan-Asian Railway Network link up with the China-Europe freight rail service.

The author is chairman of the Center for New Inclusive Asia.

This article was published in Beijing Review dated 20 December 2021. Republished with permission from the author.