Over the last decade, the Government of Thailand has invested approximately THB4 trillion to develop public infrastructure. However, the country still faces a growing infrastructure gap, with the deficit expected to grow up to USD100 billion by 2040. Green infrastructure projects must be prioritised going forwards as they can provide an opportunity for the economy to sustainable recover from the effects of the COVID-19 pandemic while also achieving green development through a shift to a low-carbon, climate-resilient economy.

In recent years, Thailand has seen an increase in the use of sustainable bonds to fund public infrastructure projects. Green, social, sustainability, and sustainability-linked bonds have grown at an exponential rate, reaching THB262 billion in October 2021. In addition, effort has been made in fostering an enabling environment, with the launch of Thailand’s first local reviewer, TRIS Rating Company Limited, and the creation of an ESG bond information portal.

In collaboration with the Asian Development Bank (ADB), the Securities and Exchange Commission (SEC), and the Public Debt Management Office (PDMO), Climate Bonds released a report titled “Green Infrastructure Investment Opportunities: Thailand,” which identifies and analyses green infrastructure projects open for potential investment in Thailand and highlights avenues for further pipeline development.

The report features 17 green projects in renewable energy, low carbon transport, water infrastructure and waste management. There is also a pipeline of over 40 initiatives in several areas, such as low-carbon transportation, renewable energy, and sustainable water and waste management. According to the report, Thailand’s potential for green infrastructure investment is valued at USD31.9 billion.


Thailand is highly vulnerable to the negative impacts of climate change, with floods being the greatest hazard in terms of economic and human impact. A single flood in 2011 caused a total lass and damages cost of THB1.43 trillion, or equivalent to roughly a 1.1 per cent loss in real GDP in 2011. Heavy rainfalls, drought, cyclones, and sea level rise are also major hazards facing the country. Thailand was ranked by the Global Climate Risk Index as the 8th most affected country globally during 1999-2018, and these climate impacts may intensify in the future climate scenarios. For example, it is projected that the number of people in Thailand affected by an extreme river flood could grow by over 2 million during 2035-2044 and coastal flooding could affect a further 2.4 million people during 2070-2100.

Thailand intends to reduce greenhouse gas (GHG) emissions by 20 -25 per cent from the business-as-usual levels by 2030 as a part of its international climate commitment under the Paris Agreement and has committed to the United Nations Framework Convention on Climate Change (UNFCCC) 2021 Conference of Parties (COP26) to reach net zero carbon emissions by 2065. The power sector-with electricity production accounting for 36 per cent of total carbon dioxide (CO2) emissions from fuel combustion – is the largest emitter in Thailand, followed by transport (31 per cent) and industry (20 per cent). In recent years, the country has shifted policy focus towards energy efficiency and clean energy and made promising progress in decreasing energy and CO2 emission intensity.

However, the country still relies heavily on fossil fuels to meet its energy demands and will therefore need to scale up investments in clean energy. Low-carbon investments in other sectors-such as transport, manufacturing and waste management-are also needed for Thailand to meet its international climate commitment on mitigation.

Apart from climate change, Thailand is facing the challenge of accelerating post-COVID-19 recovery and boosting long-term sustainable economic growth. The economic growth of Thailand slowed during 2003-2019, recording 2.4 per cent growth in the gross domestic product (GDP) in 2019 compared to 5 per cent growth during 1995-2005. Successive waves of the COVID-19 pandemic caused the Thai economy to contract 6.1 per cent6 in 2020, one of the steepest contractions among the Association of Southeast Asian Nations (ASEAN) countries. To address the COVID-19 crisis, the Government of Thailand launched stimulus spending packages totalling over THB1 trillion (USD30.3 billion). While the public spending helped mitigate the worst impacts from COVID-19 on vulnerable households, economic activity is not expected to return to its pre-pandemic levels until 2022, and the recovery is projected to be slow and uneven.

Green infrastructure has a vital role to play for Thailand to address the twin challenges of post- COVID-19 recovery, and climate change, In the short term, investment in green infrastructure can accelerate the post-COVID-19 economic recovery, while creating new economic opportunities from green jobs and boosting overall national economic competitiveness and green growth. According to the Asian Development Bank (ADB), if leveraged fully, five green growth opportunities (clean energy transition, circular economy models, sustainable urban development and transport models, productive and regenerative agriculture, and healthy and productive oceans) will require USD172 billion in capital investment and could create 30 million jobs in Southeast Asia by 2030. Significant scaling-up of investment in green infrastructure – which is low-carbon and less polluting, as well as climate- resilient–is also key for Thailand to meet its climate commitments and build resilience to the impacts of climate change, as well as to achieve rapid economic development.

Green investment opportunities exist in various sectors such as renewable energy, transport, green buildings, water, waste management, smart cities, and coastal protection. These investments will help Thailand better preserve natural assets, decouple pollutions–including GHG emissions- from economic growth, and strengthen the climate resilience of its infrastructure, economy, and communities to future shocks. As such, green infrastructure investment and the associated green growth it can deliver–is a promising strategy for the country to meet the economic transformation vision of Thailand 4.0, especially in the context of COVID-19 recovery. Much investment in infrastructure in Thailand is being carried out through public funding, followed by public-private partnership (PPP) ventures, with PPP becoming a key mechanism used by the Thai government to deliver new infrastructure projects.

While the country may experience some delays or short-term re-prioritisation of projects due to the COVID-19 pandemic, the overall infrastructure investment outlook in 2021 and beyond remains positive. However, public funding is not sufficient to meet the growing demand for these new infrastructure investments; new channels will be necessary to mobilize private capital, especially from the domestic financial market which has high liquidity in the system. By developing new infrastructure projects in a “green” manner and using green debt instruments such as green bonds, project developers can mobilize capital from a more diversified base of domestic investors looking for green. This investor diversification effect was evident when the BTS Group Holdings PCL-the public transport infrastructure company of Thailand- issued a green bond in 2020; the bond was taken up by 33.4 per cent of new investors, including asset mongers, banks, insurance companies, cooperatives, and universities. Green infrastructure can also position Thailand as an attractive emerging market destination for green investment, thus opening new opportunities for the country to gain preferential access to international green financing.

Globally, there is significant demand for green investments. Green debt instruments including green bonds and green loans–with proceeds used for climate-compatible and environmentally sustainable projects- provide useful tools for private investors looking to invest in green assets and projects globally. There is also an increasing demand for sustainable assets from Asian investors. Thailand can take advantage of this demand and attract capital by developing and promoting a green infrastructure pipeline. Going forward, the identification of green infrastructure investment opportunities in multiple sectors can help investors understand that there is a sufficiently large pool of green financially attractive investments in Thailand across several sectors.

From a policy perspective, green infrastructure investment will further accelerate the transition that Thailand has already initiated towards low-carbon and climate-resilient economy. Thailand has already put in place an enabling policy environment for climate-compatible green infrastructure investments to rapidly scale up.

Thailand’s infrastructure planning and financing

The Government of Thailand has invested close to THB4 trillion (approximately USD120 billion in 2021 dollars) in infrastructure during 2010-2020. Transport has been the dominant sector in the Infrastructure Development Master Plan (IDMP) 2015-2022, which prioritised the development of the five transport sectors

  • inter-link railway network,
  • road networks,
  • mass transit in Bangkok and neighbouring countries,
  • highway network to link with key areas in the country and with the regional countries in the Greater Mekong Subregion and ASEAN
  • water and air transport.

The estimated Investment for the IDMP reached THB3.4 trillion (USD100 billion), of which planned spending on major projects on railway and mass transit networks in Bangkok are dominant. Despite the pandemic, the infrastructure outlook for Thailand remains positive, Infrastructure investment will remain focused on the transport sector and the Eastern Economic Corridor (EEC).

The EEC is an area-based development initiative under the Thailand 4.0 economic model, covering three provinces in the eastern region: Chonbur, Rayong, and Chachoengsao. The six EFC flagship projects -which include investment in high-speed rail, airports, and logistic facilities- are implemented under the PPP model, with a total estimated investment value of over THB600 billion (USD18.2 billion). As of December 2020, public- private partnership agreements for three flagship projects (the Map Ta Phut Industrial Port (Phase 3), the High- Speed Rail Linking 3 Airports (HSR) project, and U Tapa International Airport) have been signed, with a plan to commence operations between 2024 and 2025.

The Government of Thailand has recently announced the development of the Southern Economic Corridor (SEC), which is strategically designed to complement and optimise the value generated from EEC investments. Under its development framework, SEC aims to build the western gateway for trade and the gateway for the Gulf of Thailand and the Andaman Sea for tourism, establish bio-based and processed agricultural product industries.

Outside the EEC and SEC, infrastructure investments in Thailand focuses on transport sector projects, especially urban rail systems and inter-city toll roads. The energy sector has seen a slowdown in investment due to high system reserve and sluggish electricity demand from COVID-19, but growth in private corporate power purchase agreements (PPA) for renewable energy has been observed.

Public investment dominates infrastructure financing in Thailand, but the emphasis has been shifting towards PPP in recent years. Infrastructure finance in Thailand comes from multiple sources including government budget, state owned enterprises (SUE) retained income, government and SE domestic borrowing, sovereign bonds and SE bonds, PPPs, and the Infrastructure Fund.

The key financing sources of the IDMP (2015-2022) are mainly from government and SOE borrowings (52 per cent), while PPPs account for 16 per cent. The Transportation Action Plan 2018 consisted of 44 projects with a total investment budget of THB2,021.3 billion, for which government budget and borrowing together account for 52 per cent of the financing, and PPPs for 24.85 per cent.

Given an expansion in demand for high quality infrastructure, the Government of Thailand has been promoting PPPs as a viable and innovative tool for capital mobilization to meet funding gaps- especially for large-scale projects, and effectively transfer risks by leveraging the private sector financing.  Reflecting this emphasis on PPPs, the State Enterprise Policy Office formulated a PPP Strategic Plan 2017-2021, which estimated a total investment cost of THB1.62 trillion (USD48.4 billion) and subsequently developed the PPP Project Delivery Plan 2020-2027, calling for participation from the private sector.

The Government of Thailand also issued the Public- Private Partnership Act 2019 (the PPP Act) to promote PPPs as the most effective and preferred alternative to funding infrastructure projects in the country, and stipulates the following eligibility conditions for PPP projects:


  • infrastructure projects in need of private sector funding,
  • project cost of THB5 billion (USD 182 million) at a minimum
  • eligible sectors: roads, rail, air, ports or transport by water, water management (irrigation, water works or water treatment)

The completed report can be accessed here.