China gaining on top Thai trade spot
Mainland could overtake Japan as Southeast Asian nation's leading trade partner, official says
China might overtake Japan as Thailand's biggest trading partner within three years, fuelled by Chinese investments in the Southeast Asian country, according to Srirat Rastapana, director general of international trade promotion at Thailand's Ministry of Commerce.
Japan was Thailand's biggest trading partner last year, with US$73.06 billion in trade. China was second at US$63.86 billion and the United States third at US$35.69 billion, according to official Thai data.
China was Thailand's biggest export market last year, with Thai exports to the mainland reaching US$26.9 billion.
If Hong Kong was included, Thai exports to China totaled US$40 billion last year.
The Thai government was aiming for a 10 per cent rise in Thai exports to China this year, Srirat said.
"China is the No 2 trading partner of Thailand behind Japan, but rising quickly with Chinese investment in Thailand," she said. "That's why we welcome more Chinese investment in Thailand."
Chinese companies invested in factories in Thailand, that exported their products mainly to China, Srirat said.
The Thai government was promoting Chinese investment in the industrial sector, environmentally friendly manufacturing and new technology, she said.
China is Thailand's fifth-biggest investor, having put US$4 billion into 177 projects mainly in light industry and machinery from 2007 to 2012, according to official Thai statistics. Japan is Thailand's biggest investor, followed by the European Union.
"China is the newcomer in investment in Thailand. In the last five years, Chinese investments in Thailand have become more significant," Srirat said.
The boost in Chinese investment in Thailand was driven by the Asean-China Free Trade Agreement, which took effect three years ago.
The Thai government was also evaluating proposals from Chinese, Japanese and European companies to build a high-speed railway in Thailand, but had not yet made a decision, she said.
Thai imports from China soared 11 per cent last year, faster than the 2.5 per cent rise in Thai exports to China, resulting in Thailand having a US$10.9 billion trade deficit with China, Srirat said.
"There is a big influx of cheap Chinese manufactured goods into Thailand. That is the problem," she said.