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Thailand still bullish on Chinese investments as new PM heads to Beijing

Thailand has managed to retain its attraction as a vital investment hub

Published

7 months ago

October 17, 2023

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Thailand still bullish on Chinese investments as new PM heads to Beijing

Chinese investment in Thailand has picked up pace this year despite an economic slowdown in the Asian giant, a welcome boost for the country’s new prime minister who flew into Beijing this week to bolster ties with its largest trading partner.

A stuttering recovery in the world’s second-biggest economy has spooked financial markets in 2023 as investors fretted about the impact on global growth, although Thailand has managed to retain its attraction as a vital investment hub including for China’s growth-hungry firms.

Between January and August, Thailand received foreign investment applications worth 365.2 billion baht ($10.1 billion) – 73% higher than the same period last year – led by Chinese firms that committed 90.3 billion baht, up nearly three times year-on-year, according to the Thailand Board of Investment (BOI).

Investment pledges from second-placed Singapore, totalling 76.4 billion baht, were also largely from companies originally from China, said BOI Secretary General Narit Therdsteerasukdi.

“And if you look at the month-by-month statistics, Chinese investments are still increasing,” he told Reuters. “So I see that in the next two or three years, Chinese investments will still increase drastically in Thailand.”

Net foreign direct investment to Thailand from China in the first six months of this year was up 56% year-on-year to 25.1 billion baht, central bank data shows.

This wave of investments into Thailand comes at a time of growing concerns over an economic slowdown in China, and is a shot in the arm for Thai premier Srettha Thavisin, who pledged to turn around Southeast Asia’s second largest economy when he took over the reins in August.

Thailand’s central bank expects 2024 economic growth to pick up to 4.4%, from a forecast 2.8% this year.

Srettha told reporters before flying out on Monday that his three-day visit to Beijing, centred around a forum on China’s Belt and Road Initiative, would include discussion on electric vehicles.

The premier met with Xiaomi Corp’s executive Alain Lam on Tuesday, as the smartphone maker works on its goal of producing EVs by early next year.

“The company is looking for a production facility to further its growth in many areas including EV,” a Thai government spokesperson said.

‘GOLDEN OPPORTUNITY’

Chinese EV manufacturers – including BYD and Great Wall Motor – have investment commitments of at least $1.44 billion in new facilities in Thailand, turning the country into a regional hub for EV production.

Thailand is already Southeast Asia’s largest production centre for combustion engine vehicles, hosting major facilities of Japanese carmakers including Toyota Motor and Isuzu Motors.

But a large proportion of the 228 Chinese investments proposals this year have come in the electronics sector, according to the BOI.

“We have good relationships with all countries,” Narit said. “We are a conflict-free zone.”

WHA Group, Thailand’s largest industrial estate developer, said it is seeing no slowdown in business with Chinese companies, which will help it reach a second straight year of record land sales.

“They come every week,” CEO Jareeporn Jarukornsakul told Reuters. “There really are a lot of them.”

Chinese investments will likely continue for the next two years, Jareeporn said.

“It’s a golden opportunity.”

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Chinese firm aims to expand investments in Pakistan, shows interest in mining sector

Published

1 day ago

May 17, 2024

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Chinese firm aims to expand investments in Pakistan, shows interest in mining sector

A notable Chinese company has expressed keen interest in expanding its investment in Pakistan, in yet another sign of investor confidence boost in the leadership of Prime Minister Shehbaz Sharif.

A delegation from Chinese firm MCC Tongsin Resources led by its Chairman Wang Jaichen called on PM Shehbaz here on Friday.

The premier invited the Chinese company to invest in Pakistan’s mining sector and manufacturing of export goods.

Shehbaz assured the delegation that his government would extend all-out facilitation to the company from minerals exploration and processing to the export of goods.

The PM instructed the relevant federal ministers and officers to continue consultation with the Chinese firm, taking the Balochistan chief minister, provincial departments and stakeholders on board.

The delegates reposed trust in PM Shehbaz’s leadership, and expressed keen interest in enhancing their investment in Pakistan’s mining and minerals sectors.

The delegation briefed Prime Minister Shehbaz about the construction of a mineral park in Pakistan and their future investment plans.

The premier welcomed the Chinese firm and highlighted the priority steps by his government to promote foreign investment in Pakistan.

He said that being a time-tested friend, China supported Pakistan in every difficult hour for which the Pakistani nation was grateful to the leadership and people of China.

Federal ministers Ahad Khan Cheema, Dr Musaddik Malik, Rana Tanveer Hussain, Jam Kamal Khan and relevant senior officers attended the meeting.

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Business

Govt jacks up power price by Rs1.47 per unit

Published

1 day ago

May 17, 2024

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Govt jacks up power price by Rs1.47 per unit

The government on Friday increased the electricity tariff by Rs1.47 per unit.

According to Nepra sources, the collection from consumers will take place in August, September, and October.

The electricity companies had requested the funds as part of the third quarter adjustment for 2023-2024, seeking Rs 31.34 billion under capacity charges.

Sources said that Rs5.57 billion were requested for operation and maintenance costs, and Rs12.38 billion were requested for the transmission and distribution impact under monthly fuel cost adjustment.

Previously, Nepra had completed the hearing on the electricity companies’ request under the quarterly adjustment.

Nepra approved the Power Division’s request, allowing an increase of Rs 1.45 per unit in electricity prices.

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Business

Hong Kong allows China’s digital yuan to be used in local shops

Published

1 day ago

May 17, 2024

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Hong Kong allows China's digital yuan to be used in local shops

Hong Kong will allow mainland China’s pilot digital currency to be used in shops in the city, the head of its de facto central bank said on Friday, marking a step forward for Beijing’s efforts to internationalise the yuan amid rising geopolitical tensions.

The programme, backed by Beijing, will allow mainland Chinese and Hong Kong residents to open digital yuan wallets via a mobile app developed by China’s central bank and will permit them to make payments in retail shops and some online stores in Hong Kong and in mainland China.

Transactions using e-CNY, predominantly for domestic retail payments in China, hit 1.8 trillion yuan ($249.27 billion) as of end of June 2023, with 120 million digital wallets opened, according to the latest disclosure from China’s central bank.

Using the wallet, users can make payments at over 10 million merchants in 17 provinces and cities in the mainland.

Each wallet used in the city will be subject to a balance limit of 10,000 yuan, with single transactions and daily payments capped at 2,000 yuan and 5,000 yuan, respectively, officials from the Hong Kong Monetary Authority said.

Peer-to-peer transfers will not be allowed at the moment, according to the HKMA.

“By expanding the e-CNY pilot in Hong Kong .. users may now top up their wallets anytime, anywhere without having to open a mainland bank account, thereby facilitating merchant payments in the mainland by Hong Kong residents,” HKMA Chief Eddie Yue said.

Currently, users of other digital yuan wallets such as those operated by Ant Group and Tencent can make payments in the city.

Industrial and Commercial Bank of China, Bank of China Ltd, China Construction Bank Corp and Bank of Communications Co have been selected as e-CNY wallet operators.

The yuan’s use in global finance remains low, though it has shown steady increases.

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