Thailand and Hong Kong join hands to boost regional business connectivity
All-round collaboration to strengthen infrastructure and manufacturing partnership takes cooperation to new levels
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In an environment of uncertainty fuelled by a prolonged trade war, Thailand and Hong Kong are reinforcing their already significant trade partnership with agreements to boost cooperation in infrastructure and manufacturing. One of Hong Kong’s most important trading partners, Thailand is an ideal destination for Hong Kong companies especially small- and-medium-sized businesses looking to expand. Its youthful demographic, expanding middle class and long-term government initiatives are key drivers to boost foreign investment and spur economic development.
Against this backdrop, spearheading the development of closer ties between Thailand and Hong Kong is a priority for the Hong Kong Trade Development Council (HKTDC), Hong Kong’s statutory organisation responsible for promoting trade with the world. Supporting the policies of the Hong Kong Special Administrative Region Government (HKSARG) and its free trade agreement with the ten-nation ASEAN bloc, the HKTDC has played a significant role in enhancing Hong Kong’s maturing ties with a market that took HK$60.6 billion (US$7.8 billion) of its exports last year.
Building connections at all levels
Building on the HKTDC’s ongoing efforts to promote high-level government and business exchanges, HKTDC Chairman Dr Peter K N Lam led a trade mission to Bangkok in July to showcase Hong Kong’s capabilities and role as part of the Guangdong-Hong Kong-Macao Greater Bay Area in supporting Thailand’s national development plans. Thai business leaders and project owners also participated and spoke at the Belt and Road Summit co-organised by the HKSARG and HKTDC last month, where Thailand-Mainland China-Hong Kong cooperation opportunities under the Belt and Road Initiative were discussed.
“In a business environment fraught with uncertainties, enterprises must explore ways to lower their risks and develop new markets,” Dr Lam said. “The HKTDC hopes to facilitate cooperation with Thai businesses and strengthen our business-matching work through our 50 offices around the world, including our Bangkok office, to help companies get through this challenging time.”
Creating a framework for growth
For more than two years, the HKTDC has been working to build the framework for closer government-to-government and government-to-business collaboration with Thailand in trade and investment. In addition to the memorandums of understanding signed with the Thai government agencies responsible for SMEs, industry, investment and trade, the HKTDC also delivered memorandums with Thailand’s biggest privately held conglomerate, the Charoen Pokphand Group, and a trio of financial institutions – Bangkok Bank, Export-Import Bank of Thailand and Siam Commercial Bank.
The agreements will support a framework that fosters bilateral trade and investment, the development of SMEs and enhanced economic cooperation. Many of them also supplement the priorities already identified by the Thailand government. Thailand is committed to a 20-year, advanced infrastructure development programme in three provinces east of Bangkok called the Eastern Economic Corridor (EEC), which forms part of the Thailand 4.0 strategy to promote national development focusing on innovation and creativity. Both of these initiatives can dovetail into Belt and Road and Greater Bay Area development.
July’s HKTDC trade mission to Bangkok heard from Thailand’s Deputy Prime Minister Dr Somkid Jatusripitak. Those discussions included how best to leverage Hong Kong’s competitive advantages in finance and professional services. Know-how in infrastructure development is another key need.
Earlier in July, the HKTDC also co-organised a mission with the Hong Kong Productivity Council to Thailand, during which representatives of 23 Hong Kong manufacturers, importers, exporters and trade organisations met with Thai trade and investment agencies, industry associations and developers, and visited industrial estates in Chonburi province, a focus of EEC development, to explore investment and manufacturing partnership opportunities.
Connecting through collaboration
The HKTDC-sponsored initiatives to build cooperation between the trading partners extend to start-ups. The engine room of the information economy, both Hong Kong and Thailand have agreed to collaborate on a start-up ecosystem that will see Thailand’s Ministry of Industry work with Hong Kong Cyberport.
One of the first successes of heightened Hong Kong-Thailand collaboration is an incubator that offers strategic market access to ASEAN. The InnoSpace Thailand incubator utilises the input of government agencies and private companies in the Eastern Economic Corridor and is backed by capital of at least HK$164 million (US$21 million). Hong Kong’s involvement extends to using the city’s network of venture capitalists and talent to mentor start-ups from both regions at the facility in Rayong Province.
Elsewhere in the corridor, other Hong Kong firms have also left their mark, paving the way for even closer cooperation in the future. Just north of the Pattaya City tourist destination, Hong Kong-based Ho and Partners Architects is developing a master plan for the Sriracha Creative District, a 100-hectare site in the EEC. Leading Thai property developer Life & Living hopes to create a carbon-positive smart city whose value is about US$3 billion.
Each of the projects highlights an opportunity for Hong Kong companies to benefit from infrastructure and manufacturing partnership opportunities in Thailand. By continuing to facilitate closer Thailand-Hong Kong cooperation on all levels, the HKTDC hopes to strengthen Hong Kong’s participation in regional development in a more connected ASEAN community.
