In recent years, China's growing economic allure has prompted Southeast Asian countries to increasingly gravitate towards China. Even the Philippines, which has traditionally taken a hard stance against China, is becoming more economically reliant on China.
Vietnam has experienced robust economic growth in recent years, leading to speculation about who the next economic powerhouse in Southeast Asia will be.
Could it be Thailand?
Since the new government took office last year, Thailand seems anxious about this prospect.
It's widely known that the ten ASEAN countries have become China's largest bilateral trading partners.
According to data from the General Administration of Customs of China, bilateral trade between China and ASEAN reached 6.41 trillion RMB in 2023.
Why does China choose ASEAN as its primary trading partner?
In the era of globalization, economic trends are crucial. The spillover effects of China's manufacturing industry are increasingly apparent, with a significant portion of medium and low-end manufacturing shifting to the cheaper labor markets in the South, making the entire Southeast Asia, particularly the ASEAN countries, thrive as China's major manufacturing and trading base.
Among the ASEAN countries, Vietnam stands out.
According to data from the General Department of Vietnam Customs, bilateral trade between China and Vietnam in 2023 approached $171.2 billion, accounting for over 25% of Vietnam's total trade volume.
Vietnam's exports to China amounted to $61.2 billion, a year-on-year increase of 6.4%.
Seeing Vietnam's success, other ASEAN countries are eager to emulate it, with Thailand's new government being the most proactive.
In October last year, Thailand's new prime minister showcased a blueprint for a project called the "Kra Isthmus Landbridge" at the Belt and Road Summit in Beijing, indicating their eagerness to act.
Thailand is actively formulating plans to establish closer relations with China.
Previously, although Thailand excelled in the tourism industry, attracting a large number of Chinese tourists, the number of visitors has struggled to break through bottlenecks due to various reasons.
Therefore, in September 2023, Thailand unilaterally implemented visa-free policies for China and signed a mutual visa exemption agreement on January 28 this year.
Thailand used to rely mainly on the tourism industry, but now they are determined to develop the manufacturing sector.
Faced with Vietnam's competition for Chinese manufacturing investment, Thailand has taken proactive measures.
Earlier this year, Thailand introduced a series of preferential policies for Chinese business investment to attract more Chinese companies to invest.
The Thailand Board of Investment stated that Chinese investment in Thailand covers various fields from traditional machinery manufacturing, automotive parts to electric vehicles, and new energy components.
Thailand also plans to become an important gateway for Chinese companies to enter the Southeast Asian market.
In addition to attracting Chinese manufacturing investment, Thailand is also actively participating in the Belt and Road Initiative.
One of the flagship projects of China-Thailand cooperation is the China-Thailand railway, which is expected to be completed by 2026.
Thailand hopes to attract more Chinese manufacturing companies to invest in Thailand by cooperating with China to build railways and directly export Chinese goods to the Indian Ocean.
Although Vietnam has achieved tremendous success in the manufacturing industry, Thailand also has its advantages.
Firstly, Thailand has significant transportation advantages, especially through the "Kra Isthmus Landbridge," which can bypass the Strait of Malacca and directly enter the Indian Ocean.
Secondly, Thailand's tourism industry, which has been open for many years, has accumulated rich service experience and security mechanisms. Compared to Vietnam, Thailand is safer and friendlier.
Finally, Thailand has a good historical relationship with China, with no history of war between the two countries.
Thailand hopes to cooperate with China in the future to promote the development of tourism and manufacturing industries.
Current indications suggest that Thailand is ready to embrace the new opportunities brought by Chinese companies.
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