BRI & Thailand: An Extended Neighbourhood Orientation
IT seems that the 29th APEC summit 2022 has further strengthened bilateral relations between China and Thailand.
Both countries agreed to foster cordial connections. One Belt & One Road Initiative (BRI) has become part and parcel of APEC, ASEAN, SCO, Central Asia and South-East Asia economic growth.
BRI and its flagship project CPEC have revolutionized infrastructural development in these regions, countries and communities alike. Now these are well connected and coordinated and gradually inching towards greater socio-economic integration and prosperity.
As a member country of ASEAN, Thailand is positioning itself for the BRI and incorporating its significance into the sustainable cooperation between Thailand and China at the present time, as well as for the future which is good omen for its national economy, industries, businesses and people alike.
Thailand 4.0 Policy with 10 targeted industries is in accord with Made in China 2015 policy and now both countries are cooperating to integrate it with the strategic expansion of the BRI.
In this regard, China under BRI has been supporting Thailand in infrastructure development, massive investment and technology infusion, especially in the development of the Eastern Economic Corridor (EEC) for Thailand’s economic transformation to be the hub of ASEAN.
In this connection, Thailand as a national policy is preparing itself to embrace and support the outcome of the BRI policy push as well as the development of China-Thailand strategic cooperation by linking the country’s EEC with the BRI of China, in line with the 20 year national economic and social development plan (2017-2036).
It will definitely optimize its country’s socio-economic interest as well leverage the public’s paybacks in the long run.
According to various figures, “Thailand 4.0” development strategy with its Eastern Economic Corridor (EEC) expansion expects Chinese investment amounting to US$50 billion under the flagship of BRI.
The EEC is a special economic zone focusing on new industries such as next generation cars, smart electronics, affluent medical and wellness tourism, digital and medical services, robotics, aviation, bio-fuels, bio-chemicals, among other smart technologies.
In this regard, Sino-Thai cooperation is covering new sectors of the economy consisting of digital park Thailand, human resource development & education, Eastern Economic Corridor Projects and Initiatives and cooperation in modern smart technologies.
Even close cooperation in robotics & automations, aviation & logistics, bio-energy and bio-chemicals, medical & health industry and last but not the least, digital industries have further strengthened bilateral relations in terms of investment, joint venture, business development and massive industrialization.
The policy makers of Thailand are interested in ancient but alluring elephant project of a canal across the Kra Isthmus in southern Thailand, connecting the Andaman Sea and the Gulf of Thailand against the backdrop of a second passage between the Indian and Pacific oceans.
Hopefully, if built, the said dollar canal would reduce shipping distance through the Malacca Straits by 1,200 kilometres.
BRI is the colossal brainchild of President Xi Jinping and his government. It aims to improve connectivity between China and the world through infrastructure investment and cooperation. The initiative has the potential to significantly accelerate global economic integration and development.
Currently, a Chinese high-speed railway under the BRI is under construction. It will be Thailand’s first high-speed railway that will link Thailand with Laos and Kunming in China’s southern Yunnan Province, while Thailand’s second high-speed train will link Bangkok with the EEC, a project noted by Thai officials that would contribute to the integration of the EEC with the BRI.
According to data from China’s General Administration of Customs, for nine consecutive years, China has remained Thailand’s largest trading partner and has been a major export market for Thailand’s agricultural products.
In 2021, China-Thailand bilateral trade volume hit 100 billion US dollars for the first time, with 33% year on year surging.
In this context, in January 2022, Thailand shipped for the first time agricultural goods including glutinous rice to China through the China-Laos Railway.
The new channel saves more time on transportation that can retain the freshness of tropical fruit like durians and coconut.
The China-Laos railway route has become the new channel for Thailand to export goods, especially agricultural products to China and even the Central Asian countries through the rail link of China-Europe freight express.
From January to September 2022, Chinese investment in Thailand is estimated to be around $1.2 billion, making China Thailand’s largest source of applied foreign direct investment (FDI), mostly in the electronic industry and the electric car industry.
In September 2022, BYD, China’s biggest maker of electric and hybrid cars, announced plans to build its first overseas electric passenger car plant in Rayong, a coastal city south-east of Bangkok, Thailand
To conclude, business, economic, commercial and technological ties between China and Thailand will be bolstered and diversified by the growth of the BRI and the Regional Comprehensive Economic Partnership (RECP), as well as their complementary trade in goods.
Hopefully, after the completion of mega projects of China-Thailand Railway and a number of manufacturing and energy programs their business relations will create vitality and stability to ensure stable supply chains across the Asia-Pacific region and the world in the coming years.
Interestingly, due to the RCEP pact, China-Thailand trade has further increased up to 5.1 percent year-on-year to $102 billion between January and September.
The implementation of this agreement has brought tax cuts to Thai exporters, but also encouraged Chinese manufacturers to ship more goods to Thailand.
Besides agricultural products, Thailand’s exports to China include rubber, chemicals, raw materials for plastic goods, data storage devices, automotive parts, integrated circuits, refined oil and rubber-made medical items, according to customs statistics.
China ships mainly computers, telecommunication equipment, trains, diesel oil, steel, lighting products, medical equipment, textiles and household appliances to Thailand.
Its passenger vehicles and trucks have also become popular in the Southeast Asian country in recent years.
Moreover, both countries are pursuing green, high-quality and innovation-led growth, the two-way investment cooperation has expanded from sectors such as agriculture, energy, finance, infrastructure and manufacturing to other fast-growing areas.
Furthermore, both countries should cooperate in services, production of electric vehicles, 5G, big data and cloud computing and scientific and technological innovation.
While adding the 29th APEC, Xi termed China and Thailand as good neighbours, good friends, good relatives and good partners and added that bilateral relations have withstood the test of time and grown stronger in the new era.
Year 2022 marks the 10th anniversary of the establishment of the comprehensive strategic partnership between the two countries.
China will continue working with Thailand to carry forward the two countries’ special bond of being one family, build a China-Thailand community with a shared future together and write a new chapter in bilateral relations.