Thailand has been urged to start free-trade talks with Russia as a way to strengthen economic growth in both countries, which could serve as gateways to the Asean and Eurasian markets.
Speaking yesterday at the "Thai-Russian Business, Investment and Cooperation" seminar in Bangkok, Kirill Barsky, ambassador of the Russian Federation to Thailand, said Russian enterprises were highly supportive of the idea of Thailand commencing free-trade agreement (FTA) negotiations with Russia, as the countries had a great opportunity to promote trade, investment and cooperation in many fields, which would help boost both nations’ economic growth.
Moreover, Thailand and Russia could be gateways to each region, as Russia is in Eurasia and close to Far Eastern countries, while Thailand is at the heart of Asean, he said.
"An FTA should increase trade and investment opportunity for both sides amidst a slowdown in economic growth, do away with many barriers, and increase cooperation in many sectors, in particular in trade, investment, and in science and technology, in which Russia is highly focused," said the ambassador.
Thai private enterprises should raise this topic with the Thai government to show that the private sector also wants to have an FTA with Russia, so that the country is not left behind, as Vietnam has already signed economic cooperation pacts with Eurasian countries, he added.
Barsky said that due to falling global oil prices, Thailand and Russia’s bilateral trade would not reach the target of US$10 billion (Bt35.58 billion) soon, yet he hoped that with a recovering Russian economy, and the country not being severely impacted by the international sanctions imposed on it, the goal could be achieved in the near future.
The diplomat urged Thai investors and traders to do more business with Russia, as there was great opportunity in a market with a population of some 158 million.
Although the Russian economy had slowed due to global sluggishness, he believes it will experience stronger growth in 2016 and 2017.
The Russian government has also drawn up many policies to stimulate growth, including investment policies and tax reform to attract more foreign direct investment, he explained.
One of strongest investment sectors for Thailand to explore in Russia is energy, which is a highly lucrative area, while he also encouraged cooperation in the financial sector to facilitate more investment from the Kingdom.
Sombat Thiratrakoolchai, president of the Thai-Russian Chamber of Commerce, told the seminar that the Thai business sector fully supported the idea of bilateral FTA negotiations, as Russia was a large market with strong potential.
Among the many Thai trade and investment sectors that could benefit from an FTA are trading, agricultural and farming products, automotive and parts, and electronics, he said.
With such an FTA, Thailand would be able to reduce its trade deficit with Russia, which is currently one of the Kingdom’s major fuel suppliers, as well as a supplier of other key resources such as ore, minerals and fertiliser, he added.
Sombat, who is also senior vice president of Charoen Pokphands Foods (CPF), said that only a few Thai companies were currently invested in Russia, but with a large amount of investment capital.
However, more firms are extremely interested in investing and expanding their business in Russia, as they consider it to be a high-potential market.
CPF has already invested in many projects in Russia, including in swine farming and processing, poultry, retail, crop plantation, e-commerce, and a robotics project, he said, adding that the company is also looking to do dairy business in the country.
Noppadon Khamsai, managing director of Thai Sturgeon Farm, said his company considered Russia to be a great investment destination for sturgeon farming.
The firm has already invested Bt70 million in establishing a plant in Russia, and more expansion projects will follow.
Visanu Jaroensilp, deputy governor for tourism products at the Business Tourism Authority of Thailand, said he believed that despite the declining number of Russian visitors to Thailand this year – due to the slower Russian economy and the weakening ruble – more Russians would visit next year.