Page 26 - FoodFocusThailand No.142_January 2018

SURF THE AEC
SURF THE AEC

Special Economic Zone (SEZ)

Thailand’s Eastern Economic Corridor (EEC), the Special Economic Zone (SEZ) for
the future of ASEAN is likely to be greatly successful after investors from Japan, China,
Russia, and Singapore, showed some interests in investing in the zone to make it a
new production base for Asian and the global markets.

Japan has shown particular interests. On September 11-13, 2017, China, as it has established a strong supply chain in Thailand. Moving
more than 570 executives and CEOs from several companies’ away from Thailand means that Japan will have to start from zero.
headquarters, as well as JETRO, Fukuoka, and Nikkei, led by Nonetheless, the competition between Japanese and Chinese firms
Hiroshige Seko, Minister of Economic, Trade and Industry (METI), is beneficial to Thailand and is an important factor to ensure other
had visited Thailand with the main purpose to study the readiness of countries to invest in the EEC.
the EEC in the eastern region of Thailand. The group is keen to invest Japan’s enthusiasm occurred around the same time as China
in 4 industries; 1) automotive, aviation, and aircraft overhaul centre, pushes forward its high speed train cooperation with Lao PDR,
2) electronics and robotics, 3) medical, agriculture, and food, 4) Indonesia, and Thailand, under its global mega project “One Belt,
service, trade, retail, and logistics. The interest ensures, to some One Road.” The result is that several economic corridors are aimed
extent, that the automotive industry will remain in Thailand and go to pop up along the route and link to the EEC. On the other hand,
along with the dynamic of the industry towards electric vehicles. Not the expansion of Jack Ma’s Alibaba and Alipay to Thailand will heavily
only that, the intention of the Japanese investors is in accordance influence the investment of Chinese business in the country. The
with Japan’s export policy under Prime Minister Shinzo Abe which Chinese government, at the same time, promotes state and non-state
promotes automation, industrial robotics, and internet of things enterprises to invest overseas, which resulted in more and more
(production network/online multitasking). These industries are crucial Chinese investors upcountry. Noticeably, Thailand takes in the most
for linking large scale supply chain in the economic corridor. number of overseas Chinese, 9.39 million. The country is followed
Furthermore, groups of Japanese businessmen are visiting EEC by Malaysia, the U.S., and Indonesia, which are home to 6.65 million,
continually, as seen in November 2017 when representatives from 4.95 million, and 2.83 million overseas Chinese respectively. (Data
10 companies in Yamanashi prefecture visited the area. from World Economic Forum 2016). The number reflects the
Japan remains the biggest investor in Thailand, accounting for attractiveness of Thailand among Chinese.
36.2% of total investment (data from 2016). During the first 6 months On the other side, global warming has created a new opportunity
of 2017, Japan has still been the top investor, followed by Singapore for Russia to become a new major trade partner for Thailand. The
and China whose investments account for 14.8% and 14.3%, thinning ice sheet at the North Pole is resulting in a new Arctic Sea
respectively. Although the proportion of investment from China is Route crossing from Russia to ASEAN. The new route decreased
considerably low comparing to Japan, the number continues to grow 30% of the travelling time between the destinations comparing to
steadily. However, it is not easy for Japan to renounce its position to other routes at a lower cost as icebreaker is no longer required.
In mid-2017, Russia’s Sovcomflot had launched its first service on
this route shipping LNG to South Korea with its Christophe de Margerie
Ship.
The economic relationship between Thailand and Russia has
been gradually developed. Recently, Russia announced a “Turn to
the East Policy” with aims to develop its far-eastern region to link with
the growing ASEAN and Asia Pacific economies. Since 2015, the
Eastern Economic Forum (EEF) has been held annually in
Vladivostok, which is assigned as a gateway port to Asia. In the 3 rd
EEF in September 2017 in Vladivostok, Thailand and Russia agreed
to increase the bilateral trade to USD 10 billion by 2020 (source:
www.tpso.moc.go.th) and enhance cooperation between Laem
Chabang port and Vladivostok port. In this same occasion, Thailand’s

24 FOOD FOCUS THAILAND JAN 2018