13

Why we have to understand China role?

• China is a major trading partner of Thailand.

• China's role in world political and economic stage.

• China is fast developing policies, strategies and goals for new releases.

• Note that Thailand trades with China less than Malaysia, Vietnam, Singapore trade with China.

• For economic and financial stability.

• For energy security

• Through the Silk Road Strategy

14

Why “Go Global”（走出去）?

15

The investment objective of the Chinese economic and political power.

ที่มา : https://botanwang.com

16

Economic power, China Based on the Strait of Malacca has high risk

Sudan and Angola

Strait of Malacca

Pass Myanmar

From Russia

Kazakhstan and Turkmenistan.

Iran And Saudi Arabia

From Canada

From Venezuela and Australia

Channel Japan

17

AIIB: Tools for success of the Silk Road.• World Bank: USA• ADB –Japan• China: President Xi Jinping is set concept.

The Asian Infrastructure Investment Bank (AIIB) is

1. Sources of funding for developing countries2. Leading international reserves to exploitation.3. Linking transportation network in Asia. (For

trade and investment in China).4. Push the yuan as a major world currencies.5. Co-founder of 21 member countries, 57

countries will embark in late 2015.

Strength• Economic

-ASEAN is an important partner of China (12%) were the major markets of China.

-As a source of raw materials such as rubber, cassava, fruits.

-Chinese investment is very low-wage Natural Resources.

• Energy supply gas and oil.

-More countries are Partnering with China

Challenges• Economic

• FTA-ASEAN - China's tax cuts, but increased NTB.• Different levels of economic development.

• Energy• the Middle East are vulnerable Malacca Strait.

• Politics• ASEAN is the strategic importance of China and the

United States.

22

China looks ASEAN as important and Challenges

ที่มา : http://www.ciis.org.cn/chinese/2013-11/07/content_6438775.htm

o Relations with China (the latest).Thailand, Laos, Cambodia, the Philippines, while China has a problem with

Vietnam, Myanmar, Malaysia.

o Trade-Jan - Aug 15, Chinese trade with Asia 54% (China's trade with ASEAN,

Thailand 12%, 2%).

o InvestmentAt the end of 2014, Chinese investment (cumulative) 68% Asia (ASEAN 5.4%

Thailand 0.3%).

o FinancingBSA China and ASEAN countries Using Chinese renminbi trade with all

countries.

23

Relations Between China-ASEAN

Asia54%

Africa5%

Europe18%

Latin America

6%

North America

16%

Oceania1%

Trade b/w China-other regions

The attempt to link the Silk Road to The ASEAN. In addition, there is a marine railway.

China

China

Japan

• The railway in Laos

-Boten(Laos)- Vientiane (China).

• Indonesia (China) 16-Oct-58.

• Railway in Thailand

- Bangkok - Nong Khai (China)

– Bangkok - Chiang Mai (Japanese.

China

1

A Case Study of Thailand

• The location is at the center of Thailand with ASEAN. As the strategic importance of the Silk Road on the sea.

• FTA trade cooperation in the field of agriculture.• Cooperation investments such as railway eastern lines.• Other areas of cooperation; tourism, exchange of personnel

Etc.

27

Cooperation Thailand - China today Through various partnerships as part of the "Silk Road".

ที่มา : http://www.voachinese.com/content/indonesia-high-speed-rail-20151016/3010652.html

Security of China in the region. The Chinese interests to dig Kra Isthmus, Southern Thailand

Strategic "marine Silk Road"• For energy security

• To stabilize the political and military. China's expanding influence between the Andaman Sea.

• To stabilize the economic security

Distance• 102 km wide and 400 meters deep and 25 meters.

• 10-year investment of 28,000 million USD.

• The fleet sailed garden together.

ท่ีมา : http://news.ifeng.com/a/20150518/43783020_0.shtml

• China is spearheading a gigantic financing scheme for the engineering part of the long-coveted and Chinese-dominated project of digging a 60 mile long canal across the Kra Isthmus in Southern Thailand on the Malay Peninsula.

Reason:1. Tackling the strategic Strait of Malacca

2. China's trade will grow because of increased shipping options.

3. Shorten the time and cost of shipping (1200 km).

Affects to other countries:

1. The Strait of Malacca

2. Reduce dependence

3. Competitiveness

4. Thailand increased security risk.

33

China is interested to Kla Isthmus

ที่มา : http://bbs.tianya.cn/post-worldlook-1481459-1.shtml

China has tightening up relationship to Thailand

• China's policy of proactive strategies. Long-term ASEAN and its neighbors in the region. Located in the heart of ASEAN, Thailand Build networks with other countries in the region, Thailand is also a longtime ally of the United States.

• The Chinese government has a policy of not criticizing Thailand.

• Future strategic relationship Thailand - China will be more systematic.

Thailand’s strength• Thailand is a prime location as market base.

(Vietnam as a production base. Singapore is finance and accounting bases).

• Thailand is a major food manufacturer for China.

• China is a major trading partner of Thailand, as Thailand is China's third largest trading partner in ASEAN.

Thailand’s Weakness• Thailand has the people with knowledge of

social science rather than science.

• Thailand ‘s SME still lack the knowledge to take advantage of the Framework Agreement.

• Thailand has less skill language with English and Chinese.

• Thailand faced by SME's cost competitiveness of the CLMV.

35

China looks at Thai economy: Thailand is more important.

36

In addition, Thailand is a country to invest.

1. The size of the market, high consumer price level stable and high levels of market opening

2. Thailand infrastructure is better than many countries in the region.

3. The level of openness and optimism.

4. Bilateral Cooperation Thailand - China.

5. Long experience of FDI from abroad .

CLMV competitiveness

Source: Bank of Thailand

The OFDI from Thailand accelerated since 2012 to facilitate economic integration, particularly in regional trade flows under the AEC.

Inward FDI and outward FDI of Thailand, 2005-2014

38

Northern Thailand Economy on ASEAN context

39

Trade

Services

FDI

Labor

Capital Movement

Prefer intra-regional tradeMore Good flow across country using

cooperations and agreements provided

Increase competition, services plays more an economic driver Tourism and health care services

Competitive ability Loss make company moves out

Invest outbound

Relaxing restriction for neighboring country

Increase skill labor : language andInternational standard

More freely flow of capital, currency more votality

Entrepreneurs need to accelerate the adjustment in management costs and

exchange rate risks.

Thailand Stand Point

alwww.tanitsorat.com

Opportunities and Challenges of Thailand

Logistics Infrastructure North – South Corridor in Northern Thailand• Chiang Kong : International Road Gateway (KM –BKK)• Chiang Saen: Mekong River Gateway (Chiang Saen/Guan

Lei)•Mae Sod : Regional Road Gateway (Maewwadi – Mae sod)

40www.tanitsorat.com

Opportunities and Challenges

Positioning & Strategy

◦ Border Economic Special ZOne/Border Industry Zone

◦ Logistics

◦ Transportation

◦ Tourism

◦ Education/Health Care regional Hub

Risk Management

Study the regional-risk in each basis: Cross-border mobility of people ,Transnational circulation of goods&serives ,and Transnational interactions and their results formed each transitions

41

Thailand : Opportunity

42

AEC via NORTH – SOUTH ECONOMIC

• Border Trade & Contract Farming , Investment• Regional Logistics Hub• Neighbor Investment (Industrial, Agriculture, Gas Resources)• Border Industrial• Immigrant Labor• Agriculture Investment• Regional Financial & Stock Market• Tourism Hub• Heath/Education/Service Center• Port Link/Land Bridge/ Airport Link/ Rail Link

42 www.tanitsorat.com

China's richest man, Jack Ma, says it will take '30 critical years' to get fully internet-integrated includingreplacing huge companies with small business. (Photo courtesy of Government House)

Jack Ma and Prime minister of Thailand on Oct.9.2019

• Mr Ma reaffirmed the need for an "e-road", akin to the Silk Road, to help small businesses flourish.

Jack Ma said

• "In the future, no matter how small a country is [or] your business is, if you have a big heart, open mind, and embrace tech knowledge and inclusive globalisation, you can be powerful too."

• Jack Ma in ACD meeting in Bangkok, Thailand(Oct.9.2016)

Thailand, a Natural Partner for China

50

“中泰一家亲” is a term no other country shares

No political hotspots

Very stable country

The only “no headache” access to the Indian ocean

Thailand should also be viewed as a hub for CLMVT investments

Thailand’s EEC – Long Term Drivers

51

The Eastern Economic Corridor (EEC) is Thailand’s next growth engine

Policy Stability

Need to Decentralize

Infrastructure and Industry

Upgrade

EEC – Need to Decentralize

52

Thailand’s economy, and society as a whole, is very concentrated around Greater Bangkok

The EEC project aims to modernize and upgrade its current industrial clusters, whilst moving the

activity to the southeast of Bangkok to enhance the former Eastern Seaboard industrial clusters

Investment in target industries would entitled additional incentives in addition to core incentives,

including exemption of corporate income tax for 15 years (highest thus far)

Eastern Economic Corridor (EEC)

EEC helps create a new industrial hub to serve ASEAN and especially CLMVT

EEC – Policy Stability

53

EEC is a flagship under the Thailand 4.0 program

This policy is also supported by large private corporates, thereby allowing for policy stability

across governments

1) Sector-Based Incentives

High Incentive Sectors

Advanced Manufacturing

High Value Added Businesses & Services

Maximum 8-year Corporate Income Tax Exemption

Low Incentive Sectors

Basic Industries Supporting Industries

10-year Corporate Income Tax Exemption

Biotechnology

Advanced Material

Technology

Nanotechnology Digital Technology

5) Special Incentives

• Eastern Economic Corridor (EEC)

• Special Economic Zones (SEZs)

• Others

Additional incentives depending on location of investment

4) Area-Based Incentives3) Merit-Based Incentives

Additional incentives granted activities that enhance competitiveness

• Research & Development

• Advanced Technology Training

• Others

Additional incentives for specific purposes

• SME Supporting Incentives

• Measure to Promote Productivity

• Others

2) Technology-Based Incentives

EEC incentives granted now will survive any change in government

EEC – Infrastructure and Industry Upgrade

54

Integrated Infrastructure – enhance regional and global connectivity

Industrial Upgrade – attract high-tech investment with superior incentives

Airport

Hi-Speed Rail

Deep-Sea Port

Target Industries

New Cities

5 High Priority Projects

INFRASTRUCTURE

INDUSTRIAL UPGRADE

Key Activities and Locations

High level of overlap between EEC target industries and China’s natural strengths

Conclusion

55

谢谢！

=

• "Data will be the new resource. So the next 30 years are critical for all nations in the ACD. To Asia, it is very critical," he said.

• He recalled that few people believed Chinese e-commerce could grow rapidly due to poor infrastructure for online trading.

Q&AThank you