Thailand is one of the beneficiaries of China’s post-pandemic boom, as it attracts more Chinese tourists and enjoys more trade and investment opportunities with its largest partner. Besides tourism, Thailand also benefits from China’s post-pandemic boom in terms of trade and investment. China is Thailand’s largest trading partner and a major source of foreign direct investment (FDI).
Tourism is a vital sector for Thailand’s economy, accounting for about 20% of its GDP before the pandemic. However, the outbreak of COVID-19 severely affected the industry, as international travel was restricted and domestic demand was low. In 2020, Thailand received only 6.7 million foreign tourists, compared to 39.9 million in 2019. Fortunately, Thailand has been able to recover some of its tourism losses thanks to the return of Chinese tourists, who make up the largest share of its foreign visitors.
China also remained the top investor in Thailand in 2020, with $8.5 billion worth of FDI projects approved by the Thai Board of Investment (BOI). Thailand hopes to leverage its strategic location and strong ties with China to benefit from the Belt and Road Initiative (BRI), a massive infrastructure and development project that aims to connect Asia, Europe and Africa. Thailand is part of the China-Indochina Peninsula Economic Corridor (CICPEC), one of the six economic corridors under the BRI.
The CICPEC covers several key projects in Thailand, such as the high-speed railway linking Bangkok with Nong Khai on the border with Laos, the Eastern Economic Corridor (EEC), and the Sino-Thai Rayong Industrial Zone. These projects are expected to enhance Thailand’s connectivity and competitiveness, as well as create new opportunities for trade and investment with China and other countries along the BRI routes.
In addition to these opportunities, Thai companies that act on environmental, social and governance (ESG) issues are likely to attract foreign direct investment (FDI). According to PwC Thailand, although ESG isn’t yet a make-or-break issue for Thai investors, companies need to integrate ESG factors into their corporate strategy if they want to draw major foreign investors.
As Thailand continues to benefit from China’s post-pandemic boom, there are many opportunities for Thai businesses and investors to take advantage of. From tourism recovery to trade and investment opportunities, there are many ways for Thai businesses to thrive in this new economic landscape.