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City on the Rise: Bangkok

Gateway to the N. ASEAN Region


Gateway to the N. ASEAN Region


Railroads, highways, waterways and sea lanes linking China and the northern ASEAN region pass through regional hub Bangkok. Betting on the Thai capital appears to be a smart move for anyone who wants to invest in the region.



Gateway to the N. ASEAN Region

By Monique Hou
From CommonWealth Magazine (vol. 556 )

"After Thai Prime Minister Thaksin Shinawatra was forced to step down, Thai politics have not calmed down which diminished Thailand's influence in the Association for Southeast Asian Nations (ASEAN)," observes He Shengda, deputy director of the China Society for Southeast Asian Studies.

"The AEC (Asian Economic Community) countdown waits for nobody," declared Thailand's leading English-language daily The Nation in a June editorial . The article points out that Thailand has the best geographic location in the envisaged Asian Economic Community but that it needs to overcome its political divide and carry out reforms if it wants to maintain its advantage as a key regional economic hub.

Two Epochal Projects

After the military junta under General Prayuth Chan-ocha took control of the government in May, the country, which had simmered in a political crisis, began to move forward again.

The government announced that work on the two projects of the century would resume: One is the two high-speed railroad lines that will link Thailand and China as part of the planned Trans-Asian Railway network, slated for completion in 2021. The second is the Kra Canal, which will bisect Thailand at its narrowest section. It is expected to be completed in 2050.

The Trans-Asian Railway network will eventually link Kunming in China's Yunnan Province all the way to Singapore.

Inside China, all lines are operational, as well as sections connecting Singapore, Malaysia, Thailand and Laos. Once the section that links China with Laos is completed, the network that connects the railroads of East Asia with Southeast Asia will be complete.

The planned Kra Canal, which will cut through Kra Isthmus in southern Thailand, is an even more ambitious project that would dramatically change trade routes between Europe and Asia.

The 100-km-long man-made canal will connect the Indian Ocean with Pacific Ocean via the Gulf of Thailand and the South China Sea, and will be the largest canal in Asia.

Maritime traffic between Asia and the Middle East, Europe and Africa would no longer have to pass through the congested Malacca Strait, reducing sailing distances by more than 1,000 kilometers.

Thailand: A Vital Transportation Artery

The trump card that Thailand holds is that it is located at the heart of ASEAN and shares its long border with most countries.

"Thailand is the second largest economy in ASEAN (Indonesia being the largest), connects China and Southeast Asia, enjoys a very important geographic position," He Shengda points out. "It's not just its location, Thailand was the first to advocate in the 1990s that the Indochinese Peninsula transform from a battlefield into a market. Moreover, the country took an important role in regional cooperation," elaborates He.

"We are at the heart of ASEAN. Sorry, but whether you fly, take the train or drive a car, you will have to pass through my land!" notes Vikron Kromadit, chief executive officer of Thai industrial estate developer Amata Corporation and a best-selling author.

"If we take a one-hour flight we can reach Yangon, Phnom Penh, Ho Chi Minh City, Vientiane; in two hours you can fly to Kunming, Hanoi, Singapore and Kuala Lumpur. Within this radius, everyone finds it convenient in doing business and transportation."

The importance of Bangkok and entire Thailand will greatly increase if the pan-Asian high-speed railway network and the Kra Canal are completed.

Late last year, the final link in the Kunming-Bangkok highway, a bridge over the Mekong River, was inaugurated. With the opening of the highway, China and Southeast Asia are truly interconnected by road traffic. Now cars, trucks and buses can directly travel from China all the way to Singapore.

"You should take note, Bangkok is the hub for all railroads, waterways, sea lanes connecting China and the northern ASEAN region," remarks Hsu Chih-ping, a travel agent based in the Thai capital. Seventy percent of his customers are regional business travelers.

Moreover, as a leader within ASEAN in terms of laws and regulations, basic infrastructure and quality of life as well as various industries such as petrochemicals, automobiles, processing of farming, forestry, fishing and livestock products, food, fashion and tourism, Thailand attracts large amounts of investment and tourists.

"Bangkok is highly centralized, if you want to tap the ASEAN market, you are on the safe side taking Bangkok first," believes Chao Li-min, a Taiwanese investor who produces industrial gases in Thailand.

Aside from public works and other hard infrastructure, ethnic Chinese or Taiwanese-invested companies worry about ethnic nationalism, an issue that receives rather scant attention in Western media.

No Xenophobia in Thailand

Throughout Southeast Asian history, anti-Chinese excesses have occurred in all major economies including Myanmar, Vietnam, Malaysia and Indonesia. In some places the Chinese minority still faces ethnic prejudice even today. Thailand is the only country in the region that does not discriminate against ethnic minorities.

"The Thai people are very special, they are not xenophobic, they are not anti-Chinese, they are not jealous," notes Vikron Kromadit, who is of Chinese heritage. "I am Chinese. I was a mischievous child, but no one ever called me a Chinaman in a disparaging way. My family lives in Thailand in the fourth generation and we have never been bullied by Thai people."

Some outside observers believe that Thailand is compromising its future due to its internal political divide between the Red and Yellow movement and constant military interventions in politics. Nevertheless, He Shengda believes the country should not be discounted yet.

"As things look now, there is no country that could replace Thailand. Indonesia is the biggest chunk, but Joko Widodo has only just been elected president. After he assumes office, dealing with internal conflicts will definitely be more important than tackling external issues. Malaysia runs into one problem after the other and is busy dealing with them. On top of that, Malaysia is not strong and is not willing (to take a leading role). And Singapore has always played the role of a sort of strategic adviser."

"The AEC is a marathon, not a sprint," remarks Kittakorn Charoen, professor of international politics at Chulalongkorn University in Bangkok. He envisions two possible scenarios for Thailand after it stumbled and fell from its favorable position:

First, fulfilling a transitional role, the military government will maintain political stability and end the political divide that has plagued the country. The country will then get up on its feet again and chase the other runners. Or, as widely expected by outside observers, with such a fall Thailand will have lost its competitive edge over its regional rivals forever. Only time will tell.

Translated from the Chinese by Susanne Ganz