Time and again, over the last three centuries, the vision of a vital waterway linking the Indian Ocean and the South China Sea has surfaced - along with the dire economic threat that it will pose to Singapore. Now, the reality of a Kra Canal in Thailand being built is fast taking shape, following the collapse of a top-level US$2 billion ($3.51 billion) pipeline deal to move oil from Russia to China.
The failure of the deal, which would have carried up to 20 million tons of oil each year from the Russian republic of Sakha in Siberia, underscores the urgency energy-hungry China faces to ensure that Middle Eastern supplies reach its ports safely.
Thailand has much to gain from a Kra Canal project. Singapore has just as much to lose. The Kra Canal, which has the potential of diverting half the shipping tonnage now calling at Singapore ports up north to Thailand, will have an impact on the Republic's economy which will be huge and permanent.
China badly needs imported oil to fuel its growth and its leaders are seriously looking at the Kra Canal as an alternative to the Straits of Malacca.
The Straits, which presents the shortest sea journey between Europe, Middle East and North Asia, is one of the most important waterways in the world, and most of China's and Japan's oil imports pass through it.
But the Straits is narrow: The Philip Channel near Singapore is only 2.5km wide, which creates a natural bottleneck with the potential for a collision, grounding or, after the Sept 11 attacks in the United States, sabotage by terrorists.
A large oil tanker sunk at the Philip Channel could well force vessels to take a long detour and hold up oil imports to China and Japan for weeks. As China is said to have as little as seven days of oil in reserve, it is clear why its leaders are anxious to help jump-start the Kra Canal project.
To cost at least US$20 billion, the project proposes to carve out a 50-km waterway across Thailand's narrow Kra Isthmus. The canal will allow vessels plying the Europe-Middle East-North Asia route to bypass the Straits of Malacca and cut their journey by at least 1,000km.
Of course, any vessel bypassing the Straits will bypass Singapore too.
The Kra Canal could pose a bigger threat to Singapore than the loss of manufacturing jobs, the exodus of business to China and the devastation of Sars put together.
Singapore, despite the publicity it has reaped from its high-tech reputation, has always relied on its position as Asia's top transshipment point for its prosperity.
Last month, the Beijing-controlled Economy magazine stated that it would be in China's interest to invest billions of dollars in the Kra Canal to reduce its dependency on the Straits of Malacca "choke point".
In a strange mix of politics and economics, it also explained that China had long been interested in the project, but held itself back so far because of its friendship with Singapore.
Now, however, China is less obliged to Singapore due to the latter's attitude during the Sars (Severe Acute Respiratory Syndrome) period, the magazine said. (At the height of the Sars outbreak, Singapore had criticised China for not disclosing its Sars cases earlier).
Many in Singapore have long dismissed the Kra Canal project as something that will remain a pipe dream. They could be wrong.
China, which recently overtook Japan as the second biggest oil consumer in the world (it uses about 5.36 million barrels a year, while Japan, the former number two, consumes around 5.34 million barrels), really has no choice but to go all out to ensure the safety of its oil imports. The US is the world's largest consumer.
The timing is right: The biggest supporter of the project is former Prime Minister, General Chavalit Yongchaiyudh who, since last October, has become Deputy Prime Minister of Thailand. Under him, the Thai government has sent at least three delegations to China to rope the Chinese into the Kra Canal project.
What is Singapore doing to counter this new threat? While some recent local commentaries have played down the threat of the Kra Canal, the leaders are not taking chances.
Recently, Singapore Telecom, the biggest company in Singapore which is part of the Temasek Group, took the unprecedented step of appointing an outsider, Thai businessman Chumpol NaLamlieng, as its chairman.
Mr Chumpol, 55, is head of Siam Cement, Thailand's biggest company and one closely held by the Thai royal family. Mr Chimpol is highly influential and a good man to speak for Singapore.
Temasek Holdings executive director Ho Ching recently visited Beijing to donate a thermal scanner and to mend fences damaged by the Sars crisis. She was reportedly well-received by the Chinese.
Singapore, in other words, is now actively playing its Thai and China cards, in the hope perhaps that if the Kra Canal project does take off, it will at least be in a position to be involved in it. Given the circumstances, this is really all Singapore can do.
