Philippe Schulzinger, Asia Regional Director for Transportation Business Line, has been featured in the newly published whitepaper: Future ASEAN Sustainable Cities, by Eurogroup Consulting. This comprehensive study, developed in collaboration with the French Foreign Trade Advisors as part of the CCE's APAC 2024 Forum, delves into sustainable urban development and the pivotal role of transportation in the ASEAN region.
What are Egis' activities in Asia?
Egis has had a strong presence in Asia since 1955. Our regional headquarters are in Hong Kong, with offices across Thailand, Philippines, Singapore, Indonesia and more recently, Taiwan. These strategically located technical hubs in Asia drive innovation and excellence, enabling us to develop cutting-edge solutions not only in the region but also for global markets.
We have actively contributed to public transport infrastructure projects, including metros, monorails, and BRT (Bus Rapid Transit) systems. Since 1989, we have been involved in major developments in Thailand, such as Bangkok’s metro and monorail lines.
Beyond transport, Egis also engages in urban development projects. Specialized teams in Hong Kong and Singapore focus on innovative architecture, façade engineering and building services, while in Indonesia and the Philippines—where urban construction markets are still developing—Egis conducts tailored feasibility studies to meet local needs.
What are Egis' key projects in Asia?
Here are some of Egis' key mobility projects in Asia:
- Manila Metro, Philippines: This is the first underground metro infrastructure in the Philippines, backed by JICA and in partnership with Colas and Hitachi. Egis provides expertise in system engineering, System Integrationand platform screen door turnkey package including installation, with full delivery anticipated by 2030.
- MRT New line and Extensions in Bangkok, Thailand: These projects aim to reshape Bangkok’s public transport network, Egis being involved on extending the Blue Line and on the construction of the Eastern Orange Line (with a pending Western extension to start shortly) and expanding the Purple line. In addition Egis is part of the delivery of the Pink monorail line for improved citywide accessibility.
- ATLAS Project (Advancing Transport and Logistics Accessibility Services) in Indonesia: This feasibility study aims to enhance logistics and transport infrastructure in Indonesia, supported by an Indonesia-USA alliance through MCC, a semi-public-private organization.
- Sustainable Urban Mobility Plan in Surabaya, Indonesia: This study explores sustainable transport options, including tramways, BRT (Bus Rapid Transit), and LRT (Light Rail Transit), to efficiently connect various urban hubs and traffic corridors across Surabaya.
- BRT Networks in Medan and Bandung, Indonesia: Funded by the World Bank, this project promotes eco-friendly urban mobility through BRT (Bus Rapid Transit) systems in Medan and Bandung, where Egis serves as a project management consultant for design and implementation.
- ART Network in Sarawak, Malaysia: This project introduces a hydrogen-powered Autonomous Rapid Transit (ART) system, fueled by hydrogen from local oil and gas industry waste, presenting an innovative, eco-friendly transit solution unique in the region.
- MRT Cross Island Line, Singapore: Egis provides back-office design support from Bangkok for Singapore's Cross Island MRT line, collaborating with China Harbour Engineering on this significant transport initiative.
- Monorail in Tainan, Taiwan: Egis is working on the basic design of Tainan’s first monorail line, the Blue Line, which will at term connect the high-speed rail station to downtown as part of a larger urban development effort.
How mature is the Southeast Asian market in integrating sustainability into infrastructure projects?
Southeast Asian governments now understand the critical role of urban infrastructure in driving economic growth. Cities like Jakarta and Surabaya view infrastructure projects as key to enhancing mobility and stimulating business development. However, economic priorities still tend to take precedence, and environmental awareness is advancing gradually. Since the COVID-19 pandemic, we have noticed a shift in perspective. Governments and ministries in countries like Thailand and Indonesia are increasingly open to incorporating sustainability goals, though their maturity in this area still lags behind Europe. At the community level, residents may be hesitant to change long-standing habits.
What are the main types of contracts for infrastructure projects in Southeast Asia?
Infrastructure projects in Southeast Asia use various contract models tailored to the needs of each country:
- PPP (Public-Private Partnership): Widely used in Thailand for projects like BTS metro lines and airports, this model allows for risk-sharing between the public and private sectors, often including subsidies based on passenger numbers.
- Design-Build: Common in the Philippines and other countries, this model assigns both design and construction to the same contractor. In some cases, the government provides the design, which is then opened for competitive construction bids to select the construction contractor.
- Super Turnkey: Primarily seen in Taiwan, this model goes a step further by entrusting a single contractor with the entire project. This includes not only the design and construction but also the installation of the rail system. An example of this can be seen in metro projects in Taipei, where one contractor manages all aspects of the project from start to finish.
Some countries, like Thailand, also use a combination of these models, adapting the approach to suit specific projects by sometimes separating design and construction for greater flexibility.
How are large infrastructure projects funded?
In Southeast Asia, large infrastructure projects are primarily funded by major institutions like the Japan International Cooperation Agency (JICA) and the Asian Development Bank (ADB), which provide substantial loans for these initiatives. These large-scale projects often encompass multiple consulting contracts, such as construction supervision, which alone can cost up to €200 million, with total construction expenses running into billions. For example, JICA recently supported a project in Manila with a €5 billion loan, one of its largest investments to date.
On a smaller scale, the French Development Agency (AFD) funds feasibility studies and smaller projects, typically with budgets ranging from €500,000 to €5 millions.
How does Egis position itself against competitors?
We have structured our approach around four essential pillars to position ourselves well against the competition:
1. Adopting a Holistic and Sustainable Approach: We take a comprehensive view of urban development, addressing environment, mobility, energy, and building needs in an integrated manner. Instead of merely building a transit line, we ensure each project contributes to the city’s sustainability and fits seamlessly within the urban landscape.
2. Implementing Local Centers of Excellence: We have established two regional hubs to enhance our capabilities. In Jakarta, our center specializes in urban transport planning, while our Bangkok hub, a global design center, brings expertise in civil infrastructure, geotechnics, port systems, and rail systems to support projects across Asia, Europe, and the Middle East. This local presence allows us to respond quickly and effectively to regional needs.
3. Establishing Strategic Partnerships: Recognizing the benefits of collaboration, we work closely with both local and international companies. By partnering with firms from Japan and Korea, known for competitive pricing and strong local networks, we leverage shared strengths to establish a robust market presence.
4. Committing to Innovation: Innovation drives our approach, with ongoing R&D investments to remain at the forefront of technology. We explore cutting-edge solutions, like AI-driven metro operation optimization in collaboration with universities in Thailand and France, and hydrogen propulsion systems in Malaysia. These advancements keep us agile and responsive to the sector’s evolving demands.
Is there room for foreign players in markets with strong local competition?
Foreign players do face challenges in markets with strong local competition, especially when projects are funded by institutions like JICA or the ADB, which often favor local companies. Funding structures typically encourage investment in local products and require long-term maintenance arrangements that benefit the local economy. In these setups, local firms generally retain control over equipment and maintenance. However, they usually prefer to outsource construction and integration risks to international partners, creating specific opportunities for foreign companies like Egis.
Egis leverages its French expertise, the capability to deliver turnkey systems, and a strong reputation for managing complex projects—particularly those involving diverse subsystems and cross-border partnerships—making it a valued partner in these challenging environments.
What are the key factors for successful implementation in the region?
In Southeast Asia, successful project implementation hinges on building strong, trust-based relationships that take years of consistent dialogue to establish. This trust is often personal, tied more to individuals than to the company itself, making it essential to have skilled people and a reliable network of local partners.
Additionally, commitment to quality and reliability is crucial, even if it means going beyond the initial budget. Companies aiming to make a lasting impact in the region need to deliver projects that meet high standards and are completed on time. For example, in our first project in Taiwan this year, we prioritized quality and timeliness, accepting potential additional costs as a worthwhile investment. In Asia, a successful first impression is vital—an early misstep can significantly hinder future opportunities.
