Australia reported on August 14th that Thailand plans to build a new canal between the Pacific Ocean and the Indian Ocean with the help of China's investment. Assuming (this is a major assumption) that the project goes smoothly, it will certainly create some major winners and losers.

this project is to dig a 135km canal between the Gulf of Thailand and the Andaman Sea, which passes through the isthmus of Thailand, thus shortening the journey between the Indian Ocean and the Pacific Ocean by about 1,2km (or 2-3 days), at a cost of USD 28 billion. It is equivalent to Suez Canal or Panama Canal in Asia, but it will be more difficult to build.

the project proposal has been put forward for a long time. In the 19th century, the British and the French considered it. They thought it was very difficult to build, but the British still got a promise from the King of Thailand that no one else would be allowed to build it. In the 193s, there were fears that the Japanese planned to build this canal so that the Japanese fleet could bypass the British base in Singapore. In 194, Britain filmed a famous news short film, which explained all aspects of the problem in detail.

since the beginning of this century, a new plan to build a canal has been under consideration, but no one can solve the financial support of the project. Perhaps, with the financial support from China this time, the project will be implemented.

Some security analysts worry that after the completion of the canal, China's oil tankers can avoid the narrow, crowded and vulnerable Straits of Malacca, and even provide a new channel for China's navy to enter the Indian Ocean, thus solving China's well-known "Malacca dilemma". China's navy will undoubtedly be more active in the Indian Ocean in the future, which is also strongly proved by the opening of China's first overseas naval base in Djibouti in early August.

However, the possible impact of the Kela Canal is not so much about warships as about sea containers.

building a canal is like building a new expressway through a town-it will lead to the abandonment of local service stations and small restaurants, and create opportunities for other places to build new service centers. After the Kela Canal is dug, ships can bypass Singapore and travel between the Indian Ocean and the Pacific Ocean, which may damage Singapore's control over the shipping industry and help open the door to this field for China and its friends.

Since Singapore became an intermediate station of opium trade in the Indian Ocean-Pacific region, it has prospered and developed by relying on its geographical location, and has become the largest shipping transit hub in the world and a supplier of shipping and all related services, from banks to law firms. Now, its position is threatened by the construction of a port project across South Asia funded by China.

The biggest winner of this canal may be Sri Lanka, which spans the busy sea lanes in the northern Indian Ocean, so it is the best choice for the new shipping hub. In the past few years, most of China's investment in this island has been aimed at building shipping infrastructure, including the construction of a new port in Hambantota, which was recently controlled by China.

Colombo is already the largest shipping transit hub in India, and the total shipping volume of India via Singapore is declining. If China ships can cut through the Kela Canal, Sri Lanka's competitive advantage will only increase rather than decrease. In view of the Kela Canal, India has also put forward the port project planning to be developed, but people seriously doubt that it has the ability to integrate all kinds of needed resources.

Sri Lanka has always been eager to become an Asian trade center like Singapore, and successive governments have considered Singapore's development model to be of special significance. Sri Lanka now hopes to use China to break through many problems left over from the 3-year civil war. It is also possible to draw in other big investors to compete, such as Japan.

Sri Lanka's performance in the maritime transshipment market is gratifying. Most Indian ports are in poor condition and unable to handle large-capacity container ships, which has also helped Sri Lanka. However, the business that is far more profitable than the shipping transit trade with strong competition and low profit is "unpacking" business and upgrading the value chain, just like Singapore. Colombo is likely to become a regional center for logistics, maintenance, engineering, finance and legal services, and it is right on the coast of India. This is the significance of Colombo Port City Project.

Singapore, which has always kept a clear head about its own weaknesses, has been paying attention to the possibility that Sri Lanka may become a competitor, although it understands that Sri Lanka must solve many system problems in order to be competitive in providing advanced and high-value services.

At present, the Kela Canal may just be a dream. Once, before the United States (then a rising regional power) thought it necessary to build the Panama Canal to enter the second ocean, they said the same thing.