The Thai economy will continue to prosper from trade with China despite the pandemic and the absence of deep pocket Chinese tourists, a panel of experts said Thursday.
Tharakorn Wusatirakul, the chairman of a Sino-Thai trade guild, told the audience at a panel discussion held Thursday that the future of economic relations between Thailand and China remains bright, even as data released by the government suggests a dire economy lays ahead for Thailand.
“We should be looking forward to the next normal,” Tharakorn, the chairman of the Thai-China Silk Road Trade and Investment Association, said.
“People’s behaviour has changed due to the coronavirus pandemic, but how can we adapt to the new scenario and sell more goods to them?”
Despite the much-publicized success in containing the coronavirus outbreak and having gone more than 80 days without any local transmission, Thailand’s economic outlook remains one of the gloomiest in the Southeast Asian region.
According to the National Economic and Social Development Council, the country’s GDP contracted by 12.2 percent from a year ago, the biggest decline since the 1997-1998 Asian financial crisis.
The prospect for Thai economy remains dire given its heavy reliance on tourism and exports, both of which have suffered blows from global border closures.
But a commerce official saw a silver lining in the situation: China.
Defying the chaos brought about by the pandemic, Thai exports to the People’s Republic actually grew by 5 percent, Prakhan Kordumrong of the Overseas Market Development Office said.
The government will look for ways to help Thai entrepreneurs enter the Chinese market, he added.
“China is our important market, since we exported 12 percent of our total exports to China,” Prakarn said. “We will use our overseas trade offices to promote Thai goods on both online and offline platforms, which we have partnered with Alibaba to set up a dedicated section for Thai products.”
“We will teach Thai entrepreneurs how to sell goods online as well.”
Last year, Thai exports to China totaled 902.2 billion baht, with plastic pallets, rubber products, and fresh produce among the top exported products, according to data from the commerce ministry.
The last category, especially durians, saw a significant increase despite the pandemic as Chinese demand for durians grew 140 percent from last year.
Another panelist, Li Feng, CEO of Bank of China’s Thai branch, said there are demands for Thai products since the Chinese economy has begun to recover.
He agrees that Thai entrepreneurs should familiarize themselves with the e-commerce platforms and focus on markets outside the major cities like Beijing and Shanghai.
“Chinese people love Thai products. They see it as a quality good,” Li said. “Online platforms will help entrepreneurs break free of border closures and reach every province of China.”
In return, Chinese entrepreneurs are eyeing investments in Thailand due to its strategic location in the region, he said.
“China is a very populous country, so we want to expand business overseas,” Li said. “We see Thailand as the centre of the region, so investing in Thailand means investing in other surrounding countries as well.”
While the trade war between the U.S. and China continues to take its toll, Thailand could benefit from the growing demand for Thai products and relocation of Chinese manufacturers, Piti Srisangnam, an economic expert from Chulalongkorn University, said.
Despite the war of words between the two major powers, he suggested Thai entrepreneurs set aside politics while trading with the Kingdom’s partners.
“They can distinguish between politics and economy,” Piti said. “Don’t get along with the news, all we need to do is focus on the trade.”
Punpreecha Bhuthong, an international trade expert at the Thailand Development Research Institute, or TDRI, echoed the panel’s assessment but added that the growth in trade value has to take other factors into account as well.
“The pandemic affected the bilateral trade, but only for a short period of time,” Punpreecha, who was not on the panel, said in an interview. “Once the borders reopened, trade resumed, especially fresh produce since the food was scarce.”
“However, it’s not just COVID-19, but also the swine fever outbreak in China and other factors that accelerated exports to China.”