New trade options loom as Thai-Hong Kong partnership grows
Long-term efforts and top-level meetings are paying off in opportunities for Hong Kong businesses
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Small- and medium-sized businesses are among the companies taking advantage of the closer bonds between Hong Kong and Thailand as their efforts to build ties culminate in renewed commitments to trade.
Closer ties between Thailand and Hong Kong will see improved cooperation between the two economies, aiding trade and manufacturing, and facilitating investment and services.
The heart of the strategy to boost trade will see bilateral cooperation boosted through the Belt and Road Initiative and the Thailand 4.0 economic programme, a 20-year campaign to support advanced development.
The renewed commitment to build on the Hong Kong-Thailand relationship came at the Belt and Road Summit earlier this month. The fourth edition of the summit, co-organised by the Hong Kong Special Administrative Region Government and the Hong Kong Trade Development Council (HKTDC), was held at the Hong Kong Convention and Exhibition Centre on 11 and 12 September, and attracted some 5,000 participants from around the world, including more than 500 from the ASEAN region.
Dhanin Chearavanont, Senior Chairman of Thailand’s largest privately-held conglomerate Charoen Pokphand (CP) Group, spoke at the plenary session; opportunities for closer cooperation between Thailand, Hong Kong and Mainland China were explored at project presentation and business matching sessions.
A driving force in the deepening relationship with Thailand has been the HKTDC. Concluding a business mission he led to Bangkok in July this year, HKTDC Chairman Dr Peter K N Lam said: “Thailand has long been an important ASEAN trading partner for Hong Kong. The Thai government’s Thailand 4.0 blueprint and Eastern Economic Corridor project complement the Belt and Road Initiative and Guangdong-Hong Kong-Macao Greater Bay Area development plan.”
During the mission, Dr Lam and more than 20 Hong Kong business leaders were received by Deputy Prime Minister of Thailand Dr Somkid Jatusripitak, and also met with government and business leaders including Mr Dhanin of CP Group.
This level of partnership is the result of more than two years of capacity building and deepening ties, beginning with Dr Somkid’s visit to the HKTDC in April 2017 and the subsequent Hong Kong-Shanghai Joint Infrastructure Investment Mission to Thailand in May 2017, during which Dr Somkid witnessed the signing of a memorandum of understanding between the HKTDC and Thailand’s Eastern Economic Corridor (EEC) Office.
These high-level exchanges have seen a number of successes, including CLP Power Hong Kong working with Amata, one of Thailand’s largest industrial park developers, to explore smart energy and microgrid solutions for industrial estates, and Ho & Partners Architects undertaking the design and development of a carbon-positive smart city.
The deals underline the demand for Hong Kong’s financial and professional expertise to support urban development in the EEC, as well as infrastructure skills to plan and build high-speed railways, industrial parks and smart cities.
“Thailand welcomes international and mainland investors while also bringing new opportunities for Hong Kong companies, especially in areas related to infrastructure, technology and industrial parks,” Dr Lam said. “Hong Kong enterprises are keen to participate in developments that can help them diversify their production bases and overseas markets.”
Over the past two years, the HKTDC signed memorandums of understanding with Thai government agencies to strengthen government-to-government and government-to-business ties in trade and investment, in addition to new agreements to assist SMEs and start-ups, with Thai government-backed innovation hub InnoSpace signing a deal to develop a framework for collaboration and new businesses both in Thailand and Hong Kong, and the Board of Investment of Thailand working with the HKTDC to jointly facilitate investment between the two regions.
With the commitments made under the Hong Kong-ASEAN Free Trade Agreement and related Investment Agreement coming into force in June, trade and investment between Hong Kong and Thailand have been given a further boost through enhanced legal protection and improved market access.
Thailand is one of Hong Kong’s most important trading partners in the ASEAN region. Last year, Hong Kong’s exports to Thailand were valued at HK$60.6 billion, up 12 percent from the year before. Mainland China, being Thailand’s second-biggest export market and biggest source of imports, is Thailand’s biggest trading partner.
More opportunities for Hong Kong businesses would appear likely, with Thailand committing a long-term strategy to develop provinces to the east of the capital. The three provinces included in the EEC – Rayong, Chonburi and Chachoengsao – are a showcase for Thailand 4.0.
The concept behind Thailand 4.0 is to promote and support innovation, creativity, research and development, higher technologies and green technologies. The corridor is a cornerstone of the wider strategy and is attracting government and private investment to build the infrastructure for high-technology manufacturing and green technologies.
There is a will from each of the governments involved to integrate elements of the Guangdong-Hong Kong-Macao Greater Bay Area development plan and the Belt and Road Initiative in the Thai strategy.
