Calls for action on Chinese investments in Thailand

[snoop1130]

 

The new Government of Thailand is facing calls to swiftly address the growing perception that Chinese products and investments pose a threat to Thai interests. This sentiment, if left unchecked, could harm Thailand’s export and tourism sectors.

 

President of the Panyapiwat Institute of Management and an expert on the Chinese and US economies, Sompop Manarungsan, emphasised the need for cooperation between Thailand and China to develop a mutually beneficial trade model.

 

“Negative sentiment has been growing to the point where even a Chinese fried chicken brand that recently set up franchises in Thailand is seen as a threat. There are numerous Japanese and Korean restaurants in Thailand, while Chinese fried chicken shops are relatively few.”

 

Sompop warned that unresolved perceptions and attitudes towards Chinese investment and trade could lead to a trade confrontation with China, negatively impacting Thailand’s export and tourism sectors.

 

While acknowledging that Chinese investment and the influx of Chinese products do affect local businesses, Sompop pointed out the dual nature of this relationship. Many factories in Thailand rely on low-cost components or raw materials from China.

 

He stressed the importance of consultation and understanding between the Chinese and Thai governments to address the issue early and find a win-win model for both countries. One example he cited was that if China becomes a wholesaler in Thailand, it should avoid entering the retail market to compete with local businesses.

 

Thailand faces an annual trade deficit with China of around US$10 billion, mostly due to the import of raw materials and intermediate goods, while imports of finished products from China remain relatively low.

 

Automotive industry

 

In the automotive industry, the competition from Chinese electric vehicle (EV) companies in Thailand was also discussed. Sompop pointed out that EVs and internal combustion engine (ICE)-powered vehicles are not directly competing in the same market, as the market share of EVs is still significantly smaller than that of ICE-powered cars.

 

He suggested that the Thai government should study the subsidy structures of other countries to evaluate how subsidies can support the EV market while minimising the impact on ICE-powered cars. Currently, the Thai government provides a subsidy of 100,000 baht per EV, whereas the Chinese government is gradually increasing its EV subsidy from 10,000 yuan to 20,000 yuan (from 48,107 baht to 96,214 baht) per vehicle.

 

The market is undergoing a transitional period as developed countries have imposed trade barriers on China. This has led to a reduction in Chinese exports to nations such as the US, South Korea, Japan, and European countries by more than 10% annually.

 

Sompop noted that China has not yet reduced its production capacity, resulting in a surplus of Chinese goods flowing into developing countries. He suggested that China may need to reduce its capacity or relocate production bases in the future.

 

During this transition, careful management of the transformation process is essential, Sompop advised, reported Bangkok Post.

 

By Sarishti Arora

Picture courtesy of Sunday gaurdian official website

 

Source: The Thaiger 2024-08-26

 

 

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[JoePai]

the need for cooperation between Thailand and China to develop a mutually beneficial trade model

 

555 in your dreams 

[ikke1959]

I am wondering why in some visa requirements are to invest a lot of money in Thailand. Now Chinese do it and now action is needed... Thailand make up your mind what you want... Investors?? don't complain.. free visa for investors? this is a result... Maybe put someone in charge who has really some knowledge

[Tropicalevo]

Dear Thailand.

China is not really your friend.

[brianthainess]

[Artisi]

29 minutes ago, Tropicalevo said:

Dear Thailand.

China is not really your friend.

But the ones who will benefit don't gives a rat's ar$e about being a friend of Thailand. 

[DonniePeverley]

Despite warnings Thailand agreed to build the bullet train service from China into Thailand. It's not for tourism, it's simply to allow exports to flood Thailand easier. They've done to this all neighbouring countries. 

 

They've given Chinese carte blanche to come and live in Thailand with all visa restrictions removed over the past year. 

 

Utterly ridiculous and shameful. 

[John Drake]

Gordon Chang says China is submitting high bids for liquified natural gas in order to prevent Thailand from getting a sufficient amount of energy for its factories. Reason is, he says, China fears Thai manufacturers undercutting Chinese ones.

[CallumWK]

30 minutes ago, John Drake said:

Gordon Chang says

 

Gordon Chang call himself a China expert, and predicted China would collapse by 2011.

 

NEXT

[hotchilli]

13 hours ago, snoop1130 said:

The new Government of Thailand is facing calls to swiftly address the growing perception that Chinese products and investments pose a threat to Thai interests. This sentiment, if left unchecked, could harm Thailand’s export and tourism sectors.

More of the same from Thailand, we want your infrastructure investments, we want your tourists but we don't want you ,your imports  or your citizens moving in.

[hotchilli]

13 hours ago, snoop1130 said:

While acknowledging that Chinese investment and the influx of Chinese products do affect local businesses, Sompop pointed out the dual nature of this relationship. Many factories in Thailand rely on low-cost components or raw materials from China.

Thailand cannot cherry-pick... they can't have low cost imports for raw materials so that they can stay competitive.

Thailand likes the cheap products from China that they re-sell with a mark-up.

[hotchilli]

9 hours ago, John Drake said:

China fears Thai manufacturers undercutting Chinese ones.

China is the master of that game... 

[J Branche]

Yes, this is a complex issue.  Creating and adjusting the tax structure from Foreign Businesses and Materials should be top priority. Tax = (Tariffs, import tax, business, personal) Thailand already has some Jobs that are protected.  If some other Jobs need to be protected then make then change.

 

I Don't Understand Chinese Fried Chicken Brand being threat to Thailand. KFC is number 1 Foreign chicken franchise.  

 

There are already requirements for a foreign business to have a percentage of Thai ownership.  Start Enforcement and checks on the Businesses with largest employees, income, potential to unfairly impact Thai Businesses for compliance.  

 

Lastly the Potential for China to sell materials and products to Foreign Markets Below Fair Market Value is a serious concern for any of the competing businesses in Thailand.

The time to take some action is soon and then work through the best plan later.

[jippytum]

This has been going on for years.

Many cases exposed in the press  show Thai authorities  helping these Chineese business people evade the law. 

Until Thailands politician's set an example to odinary Thai people they will follow politicians conduct and take advantage of the Chineese problem for short term gain. 

[Srikcir]

14 hours ago, ikke1959 said:

I am wondering why in some visa requirements are to invest a lot of money in Thailand. Now Chinese do it and now action is needed... Thailand make up your mind what you want... Investors?? don't complain.. free visa for investors? this is a result... Maybe put someone in charge who has really some knowledge

For the last decade Thai government has solicited Chinese investment (either FDIC or loans) in Thailand infrastructure. PM Thavisin on the one hand solicited the US for USD investments in Thailand and then supported BRIC currency as the standard for international currency, so-called dedollarization.

The only economic consistency the Thai government is for the lack of effective economic consistency.

[JimHuaHin]

1 hour ago, jippytum said:

This has been going on for years.

Many cases exposed in the press  show Thai authorities  helping these Chineese business people evade the law. 

Until Thailands politician's set an example to odinary Thai people they will follow politicians conduct and take advantage of the Chineese problem for short term gain. 

Agreed, but some powerful Chinese-Thai business families essentially control Thailand, and some of these families also have large business interests in China and are close key CCP officials.

[RichardColeman]

Thailand is very little different from most of Africa in most things - 3rd world. That is why CHina is investing

[lordgrinz]

1 hour ago, jippytum said:

This has been going on for years.

Many cases exposed in the press  show Thai authorities  helping these Chineese business people evade the law. 

Until Thailands politician's set an example to odinary Thai people they will follow politicians conduct and take advantage of the Chineese problem for short term gain. 

 

So, Never. 

[khunjeff]

16 hours ago, snoop1130 said:

if China becomes a wholesaler in Thailand, it should avoid entering the retail market to compete with local businesses

 

For the retail sector, "local businesses" pretty much means CP and Central, since they have a virtual duopoly. Do they really need protection?

 

And by the way, if you go into a grocery store in Guangzhou, the eggs will usually be from CP farms in China. So Thai investment in China = good, but Chinese investment in Thailand = bad?

[Presnock]

16 hours ago, snoop1130 said:

 

The new Government of Thailand is facing calls to swiftly address the growing perception that Chinese products and investments pose a threat to Thai interests. This sentiment, if left unchecked, could harm Thailand’s export and tourism sectors.

 

President of the Panyapiwat Institute of Management and an expert on the Chinese and US economies, Sompop Manarungsan, emphasised the need for cooperation between Thailand and China to develop a mutually beneficial trade model.

 

“Negative sentiment has been growing to the point where even a Chinese fried chicken brand that recently set up franchises in Thailand is seen as a threat. There are numerous Japanese and Korean restaurants in Thailand, while Chinese fried chicken shops are relatively few.”

 

Sompop warned that unresolved perceptions and attitudes towards Chinese investment and trade could lead to a trade confrontation with China, negatively impacting Thailand’s export and tourism sectors.

 

While acknowledging that Chinese investment and the influx of Chinese products do affect local businesses, Sompop pointed out the dual nature of this relationship. Many factories in Thailand rely on low-cost components or raw materials from China.

 

He stressed the importance of consultation and understanding between the Chinese and Thai governments to address the issue early and find a win-win model for both countries. One example he cited was that if China becomes a wholesaler in Thailand, it should avoid entering the retail market to compete with local businesses.

 

Thailand faces an annual trade deficit with China of around US$10 billion, mostly due to the import of raw materials and intermediate goods, while imports of finished products from China remain relatively low.

 

Automotive industry

 

In the automotive industry, the competition from Chinese electric vehicle (EV) companies in Thailand was also discussed. Sompop pointed out that EVs and internal combustion engine (ICE)-powered vehicles are not directly competing in the same market, as the market share of EVs is still significantly smaller than that of ICE-powered cars.

 

He suggested that the Thai government should study the subsidy structures of other countries to evaluate how subsidies can support the EV market while minimising the impact on ICE-powered cars. Currently, the Thai government provides a subsidy of 100,000 baht per EV, whereas the Chinese government is gradually increasing its EV subsidy from 10,000 yuan to 20,000 yuan (from 48,107 baht to 96,214 baht) per vehicle.

 

The market is undergoing a transitional period as developed countries have imposed trade barriers on China. This has led to a reduction in Chinese exports to nations such as the US, South Korea, Japan, and European countries by more than 10% annually.

 

Sompop noted that China has not yet reduced its production capacity, resulting in a surplus of Chinese goods flowing into developing countries. He suggested that China may need to reduce its capacity or relocate production bases in the future.

 

During this transition, careful management of the transformation process is essential, Sompop advised, reported Bangkok Post.

 

By Sarishti Arora

Picture courtesy of Sunday gaurdian official website

 

Source: The Thaiger 2024-08-26

 

 

Get the ASEAN NOW daily NEWSLETTER - Click HERE to subscribe

I notice their comment above about the power of the Chinese marketing - "even developed countries have imposed trade barriers on China" so that their local businesses are not negatively affected by the strongarmed Chinese businessmen.  And it also mentions that Thailand already has a negative annual trade deficit with China!

[2baht]

3 hours ago, hotchilli said:

China is the master of that game... 

Nihao ma, Comrade

[topt]

2 hours ago, J Branche said:

I Don't Understand Chinese Fried Chicken Brand being threat to Thailand. KFC is number 1 Foreign chicken franchise. 

The writer is making the point that this is the perception although not reality as he then says -

17 hours ago, snoop1130 said:

There are numerous Japanese and Korean restaurants in Thailand, while Chinese fried chicken shops are relatively few.”

 

[spidermike007]

Chinese businesses and above all the CCP cannot be trusted, they've been engaging in subsidizing businesses for decades now, to the point where they undercut nearly everybody that they compete with. The only solution is either sanctions or heavy tariffs on certain Chinese imports, like steel.

 

Never trust the CCP, they will always stab you in the back, that's just their nature. 

[john donson]

ban shopee?lazada?

[2baht]

4 hours ago, john donson said:

ban shopee?lazada?

Ooooooo! That's a bit mean, isn't it??? I want to see them ban the PLA! (Peoples Liberation Army!) None of this bowing to the Emperor (Xi) rubbish!!!

[JimHuaHin]

23 hours ago, khunjeff said:

 

For the retail sector, "local businesses" pretty much means CP and Central, since they have a virtual duopoly. Do they really need protection?

 

And by the way, if you go into a grocery store in Guangzhou, the eggs will usually be from CP farms in China. So Thai investment in China = good, but Chinese investment in Thailand = bad?

Yes, indeed.

 

I read an academic article last year which stated that CP was the first foreign business allowed into China after the 1949 revolution and that CP had factories and other business interests in almost every province in China.

[JimHuaHin]

22 hours ago, spidermike007 said:

Chinese businesses and above all the CCP cannot be trusted, they've been engaging in subsidizing businesses for decades now, to the point where they undercut nearly everybody that they compete with. The only solution is either sanctions or heavy tariffs on certain Chinese imports, like steel.

 

Never trust the CCP, they will always stab you in the back, that's just their nature. 

 

Unfortunately spidermike007 you are correct.

 

Too many people seem ignorant of the long dark history of the CCP.  Exporting the Chinese revolution was a important objective of Mao's China.  This involved not only supplying material military support to "developing countries", but also sending CCP cadres to help/advise local revolutionaries and proving free scholarships to students from these countries to study at Chinese universities.

 

A recent book by the Australian academic Clive Hamilton entitled "Silent Invasion" details the CCP's recent activities in Australia.  Very scary stuff.

[Will B Good]

 

 

 

The current fuss over coaches is a prime example of the Chinese taking over economically.

 

The 'Chinese' services will be allowed to run at a loss (maybe even funded by the Chinese state) until the Thai competition is wiped out....then watch service quality decline and prices jump.

 

Classic move.