Minister Highlights Focus on Construction Contractors and Steel Suppliers
PUBLISHED: 3 Apr 2025 at 14:36
The Thai government has launched investigations into two Chinese firms involved in the construction of the recently collapsed State Audit Office in Bangkok. The Ministry of Commerce has reported that these probes have expanded to other related companies.
Commerce Minister Pichai Naripthaphan confirmed that the focus is on China Railway No.10 (Thailand) Co. and Xin Ke Yuan Steel Co. Initial findings suggest possible violations of Thai regulations, particularly those governing foreign business ownership. The Department of Business Development has escalated its concerns to the Department of Special Investigation for further inquiry.
China Railway No.10 was part of an established consortium with a local partner, Italian-Thai Development Plc, working on the State Audit Office project that sadly collapsed during the Myanmar earthquake on March 28. Many of the materials used, including steel, were sourced from Xin Ke Yuan Steel.
Connections to other businesses are being scrutinized, with 13 companies linked to CREC and 24 to Xin Ke Yuan Steel under investigation. The Department of Business Development has initiated reviews on these affiliations, while the Anti-Money Laundering Office examines financial transactions involving these firms.
Quality assessments of construction materials are underway, with earlier tests indicating that the steel provided by Xin Ke Yuan Steel was below standard. Additionally, the company’s Rayong factory was shut down earlier this year for unrelated issues, with 2,400 tonnes of steel confiscated.
Employment permits for migrant workers connected to the construction site are also being reviewed, alongside inspections of the steel suppliers by the Department of Industrial Works. A comprehensive investigation into land ownership associated with these companies is ongoing, with the Comptroller-General’s Department assessing procurement and contracts.
The investigation encompasses at least 26 projects executed by 14 companies tied to the two firms, aiming to prevent any further safety risks.
China Railway Group, which oversees China Railway No.10, has historically been instrumental in developing China’s vast high-speed rail network. However, a decline in domestic project demands has prompted aggressive international expansion in recent years.
This rapid growth has seen the company’s debt increase dramatically, with a reported $211 billion in total liabilities as of 2024—almost doubling in five years. Experts highlight that significant debt can precipitate intense pressure to generate cash flow to maintain financial health.
