A recent delegation from Hong Kong and Shanghai was given the red-carpet treatment by the Thai government which is keen to attract more Chinese investment into Thailand, especially in its flagship project the Eastern Economic Corridor (EEC).
The government has ambitious plans to make the EEC, which covers the three eastern provinces of Chon Buri, Chachoengsao and Rayong, the regional economic gateway for the Asean Economic Community and Asia.
To attract investors to the EEC, Thailand will offer many incentives including low taxes, fast-track environmental impact assessments, and long-term land leases, while a special zone is being set up to attract Chinese investors. The Chinese delegates were also invited during their two-day visit to Bangkok to participate in planning for the “technopolis”, an ambitious plan to develop a smart industrial park and urban centre near U-tapao international airport targeted at S-Curve industries such as aviation, robotics, AI, smart electronics, digital services and next-generation automotive.
The government’s commitment to the EEC was further reinforced last week when it announced it would use Section 44 to speed up development in the zone. Specifically, the environmental impact assessment process will be shortened from two years to one while the public-private partnership will be cut from 15-20 months to 8-10 months.
There was certainly interest among the visiting Chinese business people. The chairman of the Hong Kong Trade Development Council (HKTDC) and leader of the Hong Kong delegation, Vincent Lo, said investors from Hong Kong and Shanghai have been conducting feasibility studies on more than 100 projects in Thailand. These are mainly focused on the EEC, particularly infrastructure such as high-speed rail and ports as well as property development. Meanwhile, e-commerce giant Alibaba has expressed interest in establishing a regional electronic-trade centre and logistics system in the EEC which would link the Thai and CLMV (Cambodia, Laos, Myanmar, Vietnam) markets. Industry Minister Uttama Savanayana said Alibaba plans to use Thailand as an e-commerce park and as the base for product distribution to CLMV.
To further spur development in the EEC a memorandum of understanding was signed between the Office of the Eastern Economic Corridor Development and the HKTDC. Meanwhile, further visits by the group are planned for later in the year when they would be taken to visit the EEC.
As China adjusts its economic base from mass production to innovation, services and high-value manufacturing, its interest in investing in Southeast Asia has increased. Countries such as Vietnam, Myanmar and Cambodia will provide an alternative production base while the region will be a very important link in the Belt and Road. Thailand wants to tap into this trend and the government hopes that the EEC will be the magnet, which will attract the investment it needs.