Future of Chiang Mai (regarding ASEAN / AEC)

[Resa]

In 2015 the ASEAN economic community will be established. http://en.wikipedia.org/wiki/Association_of_Southeast_Asian_Nations#Free_Trade

I just stumbled across this topic and Im sure some of you have already done some research on this and formed an opinion.

What impact do you think will ASEAN and the free trade agreement have on Chiang Mai and northern Thailand?

[ThaiHerbs]

I think this is an excellent topic. I have been wondering if the extended building boom here is at least partly due to expectations that the ASEAN pact will bring prosperity to SE Asia and relegate the "west" to 2nd (or 3rd) world status in time.

Doug

[DaamNaam]

Thailand is immune to any forms of change. Not much will happen at all.

[Baerboxer]

I think this is an excellent topic. I have been wondering if the extended building boom here is at least partly due to expectations that the ASEAN pact will bring prosperity to SE Asia and relegate the "west" to 2nd (or 3rd) world status in time.

Doug

I'd take it steady on those herbs Doug.

[richard10365]

It's a great question. I've been studying this own my own for a year or two now. It's good you narrowed your question down to the AEC.

Most people don't realize the AEC is only one aspect of ASEAN integration that is scheduled for 2015. Most people also don't know how extensive the AEC integration process will be. Most people think ASEAN plans to flip a switch in 2015 and shazam! Nothing could be further from the truth. The AEC started integration in 2008 and will is scheduled to finish integration in 2015.

Studying the AEC Blueprint (click here) is a great place to start. Goals and measurable objectives on the integration process can be found here. What has been accomplished can also be found on the AEC website but there is a learning curve to navigating the website and finding these nuggets of information.

According to the AEC Blueprint,

• An ASEAN single market and production base shall comprise five core elements: (i) free
  flow of goods; (ii) free flow of services; (iii) free flow of investment; (iv) freer flow of capital; and
  (v) free flow of skilled labour.

This is about as basic of an answer to your question as you can get. It's a lot more complicated than that. The good news is about 70% of the AEC's objectives have been accomplished.

The free flow of goods is mostly complete. Tariffs are 0-5%. The free flow of skilled services will have a soft launch next year and full launch in 2015.

The ASEAN Comprehensive Investment Agreement (ACIA) covers investments in ASEAN. Many details of the ACIA have already been laid out and might explain the next construction in Chiang Mai with the new malls and movie theatre.

Keep in mind, reading through the ASEAN Charter will also help answer many questions about ASEAN. If you have more questions please feel free to ask. I will try to research it.The more I study, the more I know.

[hansnl]

I think this is an excellent topic. I have been wondering if the extended building boom here is at least partly due to expectations that the ASEAN pact will bring prosperity to SE Asia and relegate the "west" to 2nd (or 3rd) world status in time.

Doug

The building boom is based on the same expectations and presumptions, more or less, as the 1997 "setback".

Banks and business moguls are indeed now warning for a repeat of that setback.

If the west will ever be relegated to 2nd or 3rd world status is debatable, while most exports of the driving Asian countries go there.

If it goes bad in the west, Asia will follow.

Take into account that most Asian countries have only a slight internal market for products now going to the west.

See what is going on in India, see the decline of growth in China, see the decline of export from Thailand. etc, etc.

And what is more, will Asean ever succeed?

[BlackArtemis]

I expect to see more Burmese, Filipino, Cambodian, and Laotian staff in restaurants. I know some people who own establishments say they can't wait to hire without the visa issue and have staff who will work and are less likely to wake up and "not feel like working there anymore".

My question is, with all this free flow of goods, where are my Mandalay Red/Blue and Myanmar beers? I want to see beer from all the countries flow in and watch Singha's and Chang's market share drop.

[ThaiHerbs]

Marc Faber says invest in Thailand where the best ASSets are located

http://www.youtube.com/watch?v=j3BxL-vCp0I

[richard10365]

I think this is an excellent topic. I have been wondering if the extended building boom here is at least partly due to expectations that the ASEAN pact will bring prosperity to SE Asia and relegate the "west" to 2nd (or 3rd) world status in time.

Doug

The building boom is based on the same expectations and presumptions, more or less, as the 1997 "setback".

Banks and business moguls are indeed now warning for a repeat of that setback.

If the west will ever be relegated to 2nd or 3rd world status is debatable, while most exports of the driving Asian countries go there.

If it goes bad in the west, Asia will follow.

Take into account that most Asian countries have only a slight internal market for products now going to the west.

See what is going on in India, see the decline of growth in China, see the decline of export from Thailand. etc, etc.

And what is more, will Asean ever succeed?

I would say ASEAN, which started in 1967, is already a success. But not sure if you are asking if ASEAN will succeed or will the AEC succeed?

[Johpa]

I think this is an excellent topic. I have been wondering if the extended building boom here is at least partly due to expectations that the ASEAN pact will bring prosperity to SE Asia and relegate the "west" to 2nd (or 3rd) world status in time.

Doug

The building boom got a big shot in the arm after the inundation of the central plains and much of Bangkok a few years ago. Those who can afford it are hedging their bets and buying condos or land.

Whether the ASEAN agreements can bring prosperity to a region where prosperity is most often siphoned off elsewhere is yet to be seen. Over the intermediate term the regional transportation infrastructure will be built out and to some extent bypass Chiang Mai although it may very well pass through Chiang Rai. And that is probably a good thing for Chiang Mai.

[jackr]

I think this is an excellent topic. I have been wondering if the extended building boom here is at least partly due to expectations that the ASEAN pact will bring prosperity to SE Asia and relegate the "west" to 2nd (or 3rd) world status in time.

Had a bit of a response to this but reckon this sums it up better:

Edited September 1, 2013 by jackr

[bristolgeoff]

look at Europe has it worked really,that is what they are base they model on

[jimmym40]

Richard10365: Here's a quote from your earlier post :

An ASEAN single market and production base shall comprise five core elements: (i) free

flow of goods; (ii) free flow of services; (iii) free flow of investment; (iv) freer flow of capital; and

(v) free flow of skilled labour.

I was just wondering if you know. Are there/will be there any easing up of visa requirements for ALL these people that supposedly will be investing in Thailand? Does the AEC, in your opinion have anything to do with the enormous amount of construction projects in CM, i.e. all the shop houses being built, and all the new moo baans going up along the new SanKamphaend road going out towards MaeOn? Some people are talking about a "bubble" starting in the housing market - would you agree? Oh, one more question. Is the AEC going to put a further strain on the CM immigration office?

[butterisbetter]

look at Europe has it worked really,that is what they are base they model on

The EC was working fine until they decided to institute a monetary union without a fiscal union. Nothing like that has been proposed for ASEAN.

[richard10365]

I expect to see more Burmese, Filipino, Cambodian, and Laotian staff in restaurants. I know some people who own establishments say they can't wait to hire without the visa issue and have staff who will work and are less likely to wake up and "not feel like working there anymore".

My question is, with all this free flow of goods, where are my Mandalay Red/Blue and Myanmar beers? I want to see beer from all the countries flow in and watch Singha's and Chang's market share drop.

There will always be a visa to contend with. There are certain jobs that will move easier across borders in ASEAN.

For example, hotel and tourism. If a person has the right certifications, then they will have the option to travel to another ASEAN country for work. The right certification means they have been tested in the country they come from for mutually recognized skills that ASEAN (all 10 countries) has agreed is needed to do a particular job. An additional benefit most are unaware of is there will be a website for employers and employees to post labor supply and demand for these jobs. Your friend will be able to shop for the person they feel will be the best person for a particular job in their business.

About the beer, if there is enough demand for something, you can get it here. I love Dr. Pepper but there is not enough demand to get it here all the time at similar prices to Coke.It comes sometimes but for 55 baht per can. Oh well, guess I have to drink Coke for now.

[hellodolly]

I think this is an excellent topic. I have been wondering if the extended building boom here is at least partly due to expectations that the ASEAN pact will bring prosperity to SE Asia and relegate the "west" to 2nd (or 3rd) world status in time.

Doug

The building boom got a big shot in the arm after the inundation of the central plains and much of Bangkok a few years ago. Those who can afford it are hedging their bets and buying condos or land.

Whether the ASEAN agreements can bring prosperity to a region where prosperity is most often siphoned off elsewhere is yet to be seen. Over the intermediate term the regional transportation infrastructure will be built out and to some extent bypass Chiang Mai although it may very well pass through Chiang Rai. And that is probably a good thing for Chiang Mai.

I believe a few years ago When China wanted to partner up with Thailand and build a high speed train through Thailand they ruled out a spur line to Chiang Mai and said Chiang Rai was a possibility.

[richard10365]

Richard10365: Here's a quote from your earlier post :

An ASEAN single market and production base shall comprise five core elements: (i) free

flow of goods; (ii) free flow of services; (iii) free flow of investment; (iv) freer flow of capital; and

(v) free flow of skilled labour.

I was just wondering if you know. Are there/will be there any easing up of visa requirements for ALL these people that supposedly will be investing in Thailand? Does the AEC, in your opinion have anything to do with the enormous amount of construction projects in CM, i.e. all the shop houses being built, and all the new moo baans going up along the new SanKamphaend road going out towards MaeOn? Some people are talking about a "bubble" starting in the housing market - would you agree? Oh, one more question. Is the AEC going to put a further strain on the CM immigration office?

If the investors come from an ASEAN country, there are some benefits. If the investor comes from a country like the USA or UK, the AEC plan does not benefit those investors. However, standardization across ASEAN might make investing easier than it has been in the past since all countries are having to change some aspect of their investment laws for this to work.

Attached is the ASEAN Comprehensive Investment Agreement Guidebook for Business and Investors to describe the current ASEAN investment objectives. It more or less lays a foundation for investment in ASEAN. Each country has the option to agree to what they choose to agree to. Once the representatives from the various ASEAN countries agree, then they must take it back to their countries for their governments to ratify it. Appendix A contains the actual agreement.

The second attachment is ASEAN Tourism Investment Guide. This book shows what the various countries agree to. Thailand is on page 225. Page 231 list areas Thailand wants investors to invest in. Some of it looks similar to what is happening in Chiang Mai. I'm not sure about the moo bahns.

I imagine there will be more strain on the CM immigration office as there will be more people to deal with.

You will have to ask Dr. Naam in the business forum about the bubble. I think he is more qualified than I am....although, I'm really not sure what that qualification is.He does seem to be very knowledgeable.

ACIA Guidebook2012 (14.3.13).pdf

ASEAN Tourism Investment Guide.pdf

[hellodolly]

I expect to see more Burmese, Filipino, Cambodian, and Laotian staff in restaurants. I know some people who own establishments say they can't wait to hire without the visa issue and have staff who will work and are less likely to wake up and "not feel like working there anymore".

My question is, with all this free flow of goods, where are my Mandalay Red/Blue and Myanmar beers? I want to see beer from all the countries flow in and watch Singha's and Chang's market share drop.

There will always be a visa to contend with. There are certain jobs that will move easier across borders in ASEAN.

For example, hotel and tourism. If a person has the right certifications, then they will have the option to travel to another ASEAN country for work. The right certification means they have been tested in the country they come from for mutually recognized skills that ASEAN (all 10 countries) has agreed is needed to do a particular job. An additional benefit most are unaware of is there will be a website for employers and employees to post labor supply and demand for these jobs. Your friend will be able to shop for the person they feel will be the best person for a particular job in their business.

About the beer, if there is enough demand for something, you can get it here. I love Dr. Pepper but there is not enough demand to get it here all the time at similar prices to Coke.It comes sometimes but for 55 baht per can. Oh well, guess I have to drink Coke for now.

There is always Pepsi Max

A few years ago there was talk of 5 countries going together to produce one visa for all 5 countries for tourists later to expand. Was this a part of it. Seems to be a good dead idea.

[richard10365]

I expect to see more Burmese, Filipino, Cambodian, and Laotian staff in restaurants. I know some people who own establishments say they can't wait to hire without the visa issue and have staff who will work and are less likely to wake up and "not feel like working there anymore".

My question is, with all this free flow of goods, where are my Mandalay Red/Blue and Myanmar beers? I want to see beer from all the countries flow in and watch Singha's and Chang's market share drop.

There will always be a visa to contend with. There are certain jobs that will move easier across borders in ASEAN.

For example, hotel and tourism. If a person has the right certifications, then they will have the option to travel to another ASEAN country for work. The right certification means they have been tested in the country they come from for mutually recognized skills that ASEAN (all 10 countries) has agreed is needed to do a particular job. An additional benefit most are unaware of is there will be a website for employers and employees to post labor supply and demand for these jobs. Your friend will be able to shop for the person they feel will be the best person for a particular job in their business.

About the beer, if there is enough demand for something, you can get it here. I love Dr. Pepper but there is not enough demand to get it here all the time at similar prices to Coke.It comes sometimes but for 55 baht per can. Oh well, guess I have to drink Coke for now.

There is always Pepsi Max

A few years ago there was talk of 5 countries going together to produce one visa for all 5 countries for tourists later to expand. Was this a part of it. Seems to be a good dead idea.

You mean like this?

Asean citizens to get entry visa-free

Eleven Media

Asia news network

Yangon August 29, 2013 1:00 am

Myanmar will allow visa-free entry to citizens of other Asean countries next fiscal year, according to the Ministry of Foreign Affairs.

During a parliamentary session on Monday, Deputy Minister Tin Oo Lwin said that Myanmar and Laos signed a reciprocal 14-day visa exemption for ordinary passport holders in 2006. It will try to sign visa exemptions with the other ASEANcountries in the next fiscal year.

Myanmar received over US$29 billion (Bt935 billion) in visa fees from April 2011 to May 2013.

The country signed an agreement with Cambodia, Indonesia and Philippines in June to develop a single "smart visa" system for tourism development in the region.

Source: http://www.nationmultimedia.com/aec/Asean-citizens-to-get-entry-visa-free-30213663.html

Edited September 1, 2013 by richard10365

[hellodolly]

I expect to see more Burmese, Filipino, Cambodian, and Laotian staff in restaurants. I know some people who own establishments say they can't wait to hire without the visa issue and have staff who will work and are less likely to wake up and "not feel like working there anymore".

My question is, with all this free flow of goods, where are my Mandalay Red/Blue and Myanmar beers? I want to see beer from all the countries flow in and watch Singha's and Chang's market share drop.

There will always be a visa to contend with. There are certain jobs that will move easier across borders in ASEAN.

For example, hotel and tourism. If a person has the right certifications, then they will have the option to travel to another ASEAN country for work. The right certification means they have been tested in the country they come from for mutually recognized skills that ASEAN (all 10 countries) has agreed is needed to do a particular job. An additional benefit most are unaware of is there will be a website for employers and employees to post labor supply and demand for these jobs. Your friend will be able to shop for the person they feel will be the best person for a particular job in their business.

About the beer, if there is enough demand for something, you can get it here. I love Dr. Pepper but there is not enough demand to get it here all the time at similar prices to Coke.It comes sometimes but for 55 baht per can. Oh well, guess I have to drink Coke for now.

There is always Pepsi Max

A few years ago there was talk of 5 countries going together to produce one visa for all 5 countries for tourists later to expand. Was this a part of it. Seems to be a good dead idea.

You mean like this?

Asean citizens to get entry visa-free

Eleven Media

Asia news network

Yangon August 29, 2013 1:00 am

Myanmar will allow visa-free entry to citizens of other Asean countries next fiscal year, according to the Ministry of Foreign Affairs.

During a parliamentary session on Monday, Deputy Minister Tin Oo Lwin said that Myanmar and Laos signed a reciprocal 14-day visa exemption for ordinary passport holders in 2006. It will try to sign visa exemptions with the other ASEANcountries in the next fiscal year.

Myanmar received over US$29 billion (Bt935 billion) in visa fees from April 2011 to May 2013.

The country signed an agreement with Cambodia, Indonesia and Philippines in June to develop a single "smart visa" system for tourism development in the region.

Source: http://www.nationmultimedia.com/aec/Asean-citizens-to-get-entry-visa-free-30213663.html

No the one they were talking about included foreigners, It was several years ago. Before the yellow shirts stirred up trouble with Cambodia. I guess it was a separate idea that died.

[beau thai]

Asean may help but Thailand still has to manage its own economy, and after relying on growth from consumers, fuelled by 3 years of too easy credit, its now payback time. For most thai consumers, their credit is maxed out now, their repayments eat into their earnings, so they have less to spend than before. And government have done little to stimulate exports or beef up infrastructure. Hence 2 quarters of decline, into the current recession.

What price house values now-overblown or what?

My view; Japanese and Chinese will invest here regardless of Asean so long as labour is cheap, and productivity better than other cheaper labour places like Cambodia. But I have been wrong before-all the time according to some.....

[Mapguy]

I appreciate this thread having been opened up, but it is a complex topic. If it stays focused on Chiang Mai, as OP intended, then we'll have a discussion that doesn't fly off into cyberspace.

Thank you, Richard 10365, for all of the leads of the background material and your follow-up comments. Some are very hard to bite into. It might be easier to read just the opening page on this one:

http://www.asean.org/communities/asean-economic-community.

Also, it is very instructive to see who the ASEAN members and their closest friends are. Take note of "ASEAN + 3."

http://en.wikipedia.org/wiki/Member_states_of_the_Association_of_Southeast_Asian_Nations

I suggest that nothing significant is going to happen without Chinese participation. There is a fundamental north-south strategic axis for this that involves Thailand.

So, to toss out a couple of ideas relevant to Chiang Mai. First, there will certainly be macroeconomic "flow effects" that will affect all of Thailand from economic integration, but it would be helpful (to OP) at least to stick to the particular effects upon Chiang Mai.

Anyway, we need to ask a couple of core questions: Where is Chiang Mai and what is here when you get here?

Second question first: What is here when you get here?

Chiang Mai is basically a sub-regional administrative, agricultural, tourist/retirement and educational hub for the Thai region. In the past it was also an economic entrepôt sub-regionally and as a stop on Thailand's version of the "Silk Road" going south.

First question: Where is Chiang Mai? Where is it now relative to where trade wants to go?

Why go to --- or through --- Chiang Mai? Transportation resources are vital. Chiang Mai has been for centuries on the trail for north-south trade (and Burmese invasions from the West), but where is it today in a much more sophisticated trading/transportation situation? Significant growth in economic development now requires a more sophisticated network than paths through the jungle and over the mountains.

Roads. Thailand is no slouch (It is indeed a leader) when it comes to road development compared with its neighbors. There are some north-south routes of relative importance which have given Chiang Mai connectivity, but how well will Chiang Mai fare in the future? There are basically two minor roads leading north from Chiang Mai. Both are problematic economically to expand much beyond what has been accomplished already. The major route north is in the next valley to the East. It should remain so.

Rail. The railroad from the south stops at Chiang Mai. (As we have noticed recently, the trains may derail before they get here, but never mind!) Chiang Mai is the end of the line. Has been for over 100 years. It will remain so. Take a look at the geography! Look at the multi-billion bhat announced plans for major rail construction in SE Asia. See the attached map. Also, read the text. Note where Chiang Mai is.

Air. Yes, airplanes hop over mountains. Maybe, Chiang Mai will get a second airport one of these days. The current location is obviously limited for future development, however, It is not an important destination or axis for trade except sub-regionally.

Water. Water is the most economical means of transportation given suitable waterways. Chiang Mai? Well, never mind!

To get a sense of the geographical realities of Chiang Mai for large-scale economic development, look at the attached Asian Development Bank's map based upon corridors of trade. Where do you find Chiang Mai? Not in the box.

So, after all this talk, what's the effect upon Chiang Mai? There will certainly be increased connectivity over a broader SE Asian-Chinese regional area, but I wager that it will remain an administrative, agricultural, tourist/retirement and educational hub of somewhat greater importance, still not a major economic-trade hub.

So, when you look at the impact of development, other things come into play (for example, financial and development bubbles like the "bhat crisis" not so long ago, the concrete real estate relics of which are still visible in Chiang Mai.

The former not-now-so-near and dear PM and his recreational megaprojects for Chiang Mai did understand a few things. For you, those building the housing estates, condos, and restaurants of today: I hope you get your timing right! If "He Who Refuses to Be Forgotten" ever does return, we might yet have a few casinos and a Thai version of Disneyland!

So, place your bets!

China - SE Asia - Rail Devlopment Graphic 2012.pdf

[Mapguy]

PS. Forgot to say I love ThaiHerbs post above! Talk about Chiang Mai being a backwater !!!!!

[WilliamCave]

I really like this topic because I have property near the new bridge in Chiang Khong .

Very interested in the investment part of the AEC and labour

[heybruce]

Marc Faber says invest in Thailand where the best ASSets are located

http://www.youtube.com/watch?v=j3BxL-vCp0I

I don't think this was filmed in Chiang Mai. However if I'm wrong, will someone please point me to this part of town?

[richard10365]

I appreciate this thread having been opened up, but it is a complex topic. If it stays focused on Chiang Mai, as OP intended, then we'll have a discussion that doesn't fly off into cyberspace.

Thank you, Richard 10365, for all of the leads of the background material and your follow-up comments. Some are very hard to bite into. It might be easier to read just the opening page on this one:

http://www.asean.org/communities/asean-economic-community.

Also, it is very instructive to see who the ASEAN members and their closest friends are. Take note of "ASEAN + 3."

http://en.wikipedia.org/wiki/Member_states_of_the_Association_of_Southeast_Asian_Nations

I suggest that nothing significant is going to happen without Chinese participation. There is a fundamental north-south strategic axis for this that involves Thailand.

So, to toss out a couple of ideas relevant to Chiang Mai. First, there will certainly be macroeconomic "flow effects" that will affect all of Thailand from economic integration, but it would be helpful (to OP) at least to stick to the particular effects upon Chiang Mai.

Anyway, we need to ask a couple of core questions: Where is Chiang Mai and what is here when you get here?

Second question first: What is here when you get here?

Chiang Mai is basically a sub-regional administrative, agricultural, tourist/retirement and educational hub for the Thai region. In the past it was also an economic entrepôt sub-regionally and as a stop on Thailand's version of the "Silk Road" going south.

First question: Where is Chiang Mai? Where is it now relative to where trade wants to go?

Why go to --- or through --- Chiang Mai? Transportation resources are vital. Chiang Mai has been for centuries on the trail for north-south trade (and Burmese invasions from the West), but where is it today in a much more sophisticated trading/transportation situation? Significant growth in economic development now requires a more sophisticated network than paths through the jungle and over the mountains.

Roads. Thailand is no slouch (It is indeed a leader) when it comes to road development compared with its neighbors. There are some north-south routes of relative importance which have given Chiang Mai connectivity, but how well will Chiang Mai fare in the future? There are basically two minor roads leading north from Chiang Mai. Both are problematic economically to expand much beyond what has been accomplished already. The major route north is in the next valley to the East. It should remain so.

Rail. The railroad from the south stops at Chiang Mai. (As we have noticed recently, the trains may derail before they get here, but never mind!) Chiang Mai is the end of the line. Has been for over 100 years. It will remain so. Take a look at the geography! Look at the multi-billion bhat announced plans for major rail construction in SE Asia. See the attached map. Also, read the text. Note where Chiang Mai is.

Air. Yes, airplanes hop over mountains. Maybe, Chiang Mai will get a second airport one of these days. The current location is obviously limited for future development, however, It is not an important destination or axis for trade except sub-regionally.

Water. Water is the most economical means of transportation given suitable waterways. Chiang Mai? Well, never mind!

To get a sense of the geographical realities of Chiang Mai for large-scale economic development, look at the attached Asian Development Bank's map based upon corridors of trade. Where do you find Chiang Mai? Not in the box.

So, after all this talk, what's the effect upon Chiang Mai? There will certainly be increased connectivity over a broader SE Asian-Chinese regional area, but I wager that it will remain an administrative, agricultural, tourist/retirement and educational hub of somewhat greater importance, still not a major economic-trade hub.

So, when you look at the impact of development, other things come into play (for example, financial and development bubbles like the "bhat crisis" not so long ago, the concrete real estate relics of which are still visible in Chiang Mai.

The former not-now-so-near and dear PM and his recreational megaprojects for Chiang Mai did understand a few things. For you, those building the housing estates, condos, and restaurants of today: I hope you get your timing right! If "He Who Refuses to Be Forgotten" ever does return, we might yet have a few casinos and a Thai version of Disneyland!

So, place your bets!

Hi Mapguy,

You bring up some excellent points for a great subject. I agree with trying to focus on Chiang Mai. I mentioned a bit more because it would be impossible for some to grasp what ASEAN is trying to do without understanding the background or the intensity of their goals.

I agree that China is important to the process in Chiang Mai. We are the largest big city in Thailand that is closest to China and thanks to a recent movie made in Chiang Mai, we seem to be a Chinese tourist hot spot a bit more than before.

Although, Chiang Mai seems a bit off the beaten path to China, it doesn't seem to deter the amount of FDI that seems to be flowing into the city. A more direct path from Bangkok to China would go through Lampang, Payap, Chiang Rai and more north to China.

However, looking west, there are a lot of Indian consumers ASEAN and Chiang Mai could possibly benefit from with/if trade routes running directly through Myanmar to India were improved. I attached a 2010 UN map showing the possibilities. FDI from India could be a factor in seeing these trade routes expanded.

Also, a new sea port is being is being considered (http://www.globalpost.com/dispatch/news/kyodo-news-international/130816/myanmar-eyeing-possibility-building-new-deep-sea-port) located between Ye and Mawlamyine towns in Mon State which might give Chiang Mai closer access to the sea.

There are many possibilities being considered.

[harrry]

I appreciate this thread having been opened up, but it is a complex topic. If it stays focused on Chiang Mai, as OP intended, then we'll have a discussion that doesn't fly off into cyberspace.

Thank you, Richard 10365, for all of the leads of the background material and your follow-up comments. Some are very hard to bite into. It might be easier to read just the opening page on this one:

http://www.asean.org/communities/asean-economic-community.

Also, it is very instructive to see who the ASEAN members and their closest friends are. Take note of "ASEAN + 3."

http://en.wikipedia.org/wiki/Member_states_of_the_Association_of_Southeast_Asian_Nations

I suggest that nothing significant is going to happen without Chinese participation. There is a fundamental north-south strategic axis for this that involves Thailand.

So, to toss out a couple of ideas relevant to Chiang Mai. First, there will certainly be macroeconomic "flow effects" that will affect all of Thailand from economic integration, but it would be helpful (to OP) at least to stick to the particular effects upon Chiang Mai.

Anyway, we need to ask a couple of core questions: Where is Chiang Mai and what is here when you get here?

Second question first: What is here when you get here?

Chiang Mai is basically a sub-regional administrative, agricultural, tourist/retirement and educational hub for the Thai region. In the past it was also an economic entrepôt sub-regionally and as a stop on Thailand's version of the "Silk Road" going south.

First question: Where is Chiang Mai? Where is it now relative to where trade wants to go?

Why go to --- or through --- Chiang Mai? Transportation resources are vital. Chiang Mai has been for centuries on the trail for north-south trade (and Burmese invasions from the West), but where is it today in a much more sophisticated trading/transportation situation? Significant growth in economic development now requires a more sophisticated network than paths through the jungle and over the mountains.

Roads. Thailand is no slouch (It is indeed a leader) when it comes to road development compared with its neighbors. There are some north-south routes of relative importance which have given Chiang Mai connectivity, but how well will Chiang Mai fare in the future? There are basically two minor roads leading north from Chiang Mai. Both are problematic economically to expand much beyond what has been accomplished already. The major route north is in the next valley to the East. It should remain so.

Rail. The railroad from the south stops at Chiang Mai. (As we have noticed recently, the trains may derail before they get here, but never mind!) Chiang Mai is the end of the line. Has been for over 100 years. It will remain so. Take a look at the geography! Look at the multi-billion bhat announced plans for major rail construction in SE Asia. See the attached map. Also, read the text. Note where Chiang Mai is.

Air. Yes, airplanes hop over mountains. Maybe, Chiang Mai will get a second airport one of these days. The current location is obviously limited for future development, however, It is not an important destination or axis for trade except sub-regionally.

Water. Water is the most economical means of transportation given suitable waterways. Chiang Mai? Well, never mind!

To get a sense of the geographical realities of Chiang Mai for large-scale economic development, look at the attached Asian Development Bank's map based upon corridors of trade. Where do you find Chiang Mai? Not in the box.

So, after all this talk, what's the effect upon Chiang Mai? There will certainly be increased connectivity over a broader SE Asian-Chinese regional area, but I wager that it will remain an administrative, agricultural, tourist/retirement and educational hub of somewhat greater importance, still not a major economic-trade hub.

So, when you look at the impact of development, other things come into play (for example, financial and development bubbles like the "bhat crisis" not so long ago, the concrete real estate relics of which are still visible in Chiang Mai.

The former not-now-so-near and dear PM and his recreational megaprojects for Chiang Mai did understand a few things. For you, those building the housing estates, condos, and restaurants of today: I hope you get your timing right! If "He Who Refuses to Be Forgotten" ever does return, we might yet have a few casinos and a Thai version of Disneyland!

So, place your bets!

Hi Mapguy,

You bring up some excellent points for a great subject. I agree with trying to focus on Chiang Mai. I mentioned a bit more because it would be impossible for some to grasp what ASEAN is trying to do without understanding the background or the intensity of their goals.

I agree that China is important to the process in Chiang Mai. We are the largest big city in Thailand that is closest to China and thanks to a recent movie made in Chiang Mai, we seem to be a Chinese tourist hot spot a bit more than before.

Although, Chiang Mai seems a bit off the beaten path to China, it doesn't seem to deter the amount of FDI that seems to be flowing into the city. A more direct path from Bangkok to China would go through Lampang, Payap, Chiang Rai and more north to China.

However, looking west, there are a lot of Indian consumers ASEAN and Chiang Mai could possibly benefit from with/if trade routes running directly through Myanmar to India were improved. I attached a 2010 UN map showing the possibilities. FDI from India could be a factor in seeing these trade routes expanded.

Also, a new sea port is being is being considered (http://www.globalpost.com/dispatch/news/kyodo-news-international/130816/myanmar-eyeing-possibility-building-new-deep-sea-port) located between Ye and Mawlamyine towns in Mon State which might give Chiang Mai closer access to the sea.

There are many possibilities being considered.

For all the UN stamp on it I am sure this map would promote quite a few diplomatic incidents. Look at the area under republic of Laos for exmple.

The routes are quite interesting though.

[Rinrada]

I expect to see more Burmese, Filipino, Cambodian, and Laotian staff in restaurants. I know some people who own establishments say they can't wait to hire without the visa issue and have staff who will work and are less likely to wake up and "not feel like working there anymore".

My question is, with all this free flow of goods, where are my Mandalay Red/Blue and Myanmar beers? I want to see beer from all the countries flow in and watch Singha's and Chang's market share drop.

There will always be a visa to contend with. There are certain jobs that will move easier across borders in ASEAN.

For example, hotel and tourism. If a person has the right certifications, then they will have the option to travel to another ASEAN country for work. The right certification means they have been tested in the country they come from for mutually recognized skills that ASEAN (all 10 countries) has agreed is needed to do a particular job. An additional benefit most are unaware of is there will be a website for employers and employees to post labor supply and demand for these jobs. Your friend will be able to shop for the person they feel will be the best person for a particular job in their business.

About the beer, if there is enough demand for something, you can get it here. I love Dr. Pepper but there is not enough demand to get it here all the time at similar prices to Coke.It comes sometimes but for 55 baht per can. Oh well, guess I have to drink Coke for now.

In the case of well qualified English speaking doctors/nurses/medical staff from say the Philippines

there should be no restrictions with work opportunities and with as mentioned all the new Housing MOO Bann developments on the 1317 ..road to Mae On they have instant accommodation with again no "foreign" restrictions on buying said properties.

New ASEAN Common Market.....do the local Thais know about this...?

[richard10365]

Haha...I just noticed I said earlier...

• A more direct path from Bangkok to China would go through Lampang, Payap, Chiang Rai and more north to China.

Haha...Payap is not on the beaten path to China. Sorry...I meant to say Phayao.

[richard10365]

I expect to see more Burmese, Filipino, Cambodian, and Laotian staff in restaurants. I know some people who own establishments say they can't wait to hire without the visa issue and have staff who will work and are less likely to wake up and "not feel like working there anymore".

My question is, with all this free flow of goods, where are my Mandalay Red/Blue and Myanmar beers? I want to see beer from all the countries flow in and watch Singha's and Chang's market share drop.

There will always be a visa to contend with. There are certain jobs that will move easier across borders in ASEAN.

For example, hotel and tourism. If a person has the right certifications, then they will have the option to travel to another ASEAN country for work. The right certification means they have been tested in the country they come from for mutually recognized skills that ASEAN (all 10 countries) has agreed is needed to do a particular job. An additional benefit most are unaware of is there will be a website for employers and employees to post labor supply and demand for these jobs. Your friend will be able to shop for the person they feel will be the best person for a particular job in their business.

About the beer, if there is enough demand for something, you can get it here. I love Dr. Pepper but there is not enough demand to get it here all the time at similar prices to Coke.It comes sometimes but for 55 baht per can. Oh well, guess I have to drink Coke for now.

In the case of well qualified English speaking doctors/nurses/medical staff from say the Philippines

there should be no restrictions with work opportunities and with as mentioned all the new Housing MOO Bann developments on the 1317 ..road to Mae On they have instant accommodation with again no "foreign" restrictions on buying said properties.

New ASEAN Common Market.....do the local Thais know about this...?

I do believe there still restrictions on foreigners owning land.