Following where China has been spending and investing its Belt & Road Initiative capital can provide foreign investment (FDI) clues and reveal new opportunities in recipient countries.

As infrastructure builds start to yield productive user cash flows and the need for subsequent support services arises, case studies for investment potential become apparent. In this new series, we will be examining where China has spent its money and where returns on investment exist for foreign investors in piggybacking onto opportunities created by the BRI build.

A hub for Chinese investors

Thailand has been a consistent recipient of Chinese investment for some time, and its geostrategic position as the heart of the ASEAN free trade bloc, with free trade access also to China and India, has made it a hub for many Chinese investors.

This has manifested itself primarily in the drive to digital economies and is building Thailand up both as a connectivity hub, and as a key node for Asia in new tech. Plenty of money is being both raised and made via Chinese investments into various Thai based initiatives in crypto, fintech, blockchain, and AI, as well as health care, including medical tourism.   

This, coupled with extensive infrastructure connectivity plans uniting Thailand to ASEAN, other export markets, and the development of numerous free trade zones on outlying islands is seeing the country take on a highly competitive global role for foreign investment into the South Asian region.

Thailand is a member of both ASEAN and RCEP allowing foreign investment to flow more easily between countries
Thailand is a member of both ASEAN and RCEP allowing foreign investment to flow more easily between countries

Both light manufacturing zones and a nationwide digitization program are seeing Chinese investments made in conjunction with the China-ASEAN Free Trade Agreement and the recent RCEP agreement – Thailand is a member of both ASEAN and RCEP and this shows how both have been combining development with free trade and developing the countries manufacturing to allow it to become a China investment alternative for foreign investors wishing to reduce their China reliance. 

Foreign investment (FDI) Background  

According to the Bank of Thailand, foreign investment (FDI) in Thailand declined drastically as a result of the COVID-19 pandemic. Between 2018 and 2019, FDI plunged from US$13.2 to US$4.8 billion. In 2020, it fell to minus (-$4.8 billion). At a time when others have been pulling out, China’s investments in Thailand, Southeast Asia’s second-largest economy, steadily increased throughout the pandemic period.   

Notably, in 2019, China’s investment applications surpassed Japan for the first time – with an investment value of US$8.7 billion under 203 approved projects, far surpassing Japan’s $2.4 billion (277 projects) and third-ranked Hong Kong’s $1.2 billion (64 projects).  

Trade  

China has remained Thailand’s largest trading partner for nine consecutive years. Bilateral trade volume surged 33% year on year to US$131.18 billion in 2021, according to data from China’s General Administration of Customs 

Infrastructure  

The Don Mueang-Suvarnabhumi-U-Tapao High-Speed Railway – In October 2019, the State Railway of Thailand signed an agreement with a consortium including CRCC to build a US$7.4 billion high-speed railway connecting three airports.  

The Don Mueang–Suvarnabhumi–U-Tapao high-speed railway, officially known as the High-Speed Rail Linking Three Airports Project is the second high-speed rail line project in Thailand, is due to open in 2026 between Don Mueang International Airport, Suvarnabhumi Airport and U-Tapao International Airport.  

Sino-Thailand-Laos Railway Project – In December 2021, the government set up a working panel proposed by the Transport Ministry to better coordinate with transport authorities in Laos on plans to build a railway linking the two countries. This is part of a high-speed railway project linking Thailand’s rail system with the Laos-China Railway, which also connects Kunming with Vientiane (Laos). In Thailand, the project is divided into 3 phases: the Bangkok-Nakhon Ratchasima section covering 253 km, the Nakhon Ratchasima-Nong Khai section (356km); and the Nong Khai-Vientiane section (16km).  

China/EEC – the Eastern Economic Corridor (EEC) – is located some 90 km southeast of Bangkok, and is a centerpiece for new investment, targeting technology, innovation, SMART manufacturing, and tourism. To date, Chinese companies have established manufacturing facilities, research centers, or operational hubs in the specially designated Thai SEZs, including EEC and four SEZs along the Thai borders.  

China’s Holley Group and the Thai industrial estate developer Amata developed the Thai-Chinese Rayong Industrial Park located in Thailand’s EEC. To date, this SEZ (alone) has seen investment from circa 100 Chinese manufacturers to invest US$2.5 billion, which now employs over 20,000 Thai staff and over 3,000 Chinese expatriate workers.  

Other Investments  

E-commerce  

In September 2017 JD.com (JD Finance) signed a partnership with Thailand’s largest retail conglomerate Central Group, and Provident Capital for an aggregate investment of up to US$500 million to establish two Thailand-based JVs in e-commerce and fintech. In September 2019, JD.com and Central Group, a Thai conglomerate involved in merchandising, real estate, and retailing, launched a financial services app called Dolfin. The new service is set to have an e-wallet function, as well as digital lending, insurance, and wealth management offerings.  

Telecommunications  

In April 2019, Thailand launched a Huawei 5G test bed, however, thus far Huawei has not won a 5G contract in Thailand.  

Smart Phones 

In 2021, Xiaomi ranked No. 1 in Thailand for the first time.  

ASEAN’s first 5G “Smart Hospital”  

In December 2021, Siriraj Hospital and Huawei announced that their 5G smart hospital project is the “first and largest” in Thailand and the Southeast Asian region. The Siriraj 5G Smart Hospital is a pilot project, which will expand to other ASEAN hospitals in the future. It is expected that 30 5G medical applications will be incubated and promoted nationwide in 2022.

The Siriraj World Class 5G Smart Hospital project comprises nine sub-projects comprising smart emergency rooms and emergency medical service, a pathological diagnosis system with 5G and AI, an AI platform for noncommunicable diseases, smart inventory management, a permission-based blockchain for personal health records, smart logistics with 5G self-driving cars, multi-access edge computing, and a hybrid cloud system.  

Ascend – Thailand’s first fintech unicorn  

In September 2021, Ascend Money, a startup backed by Ant Group and Charoen Pokphand Group, became Thailand’s first fintech unicorn with a valuation of US$1.5 billion following a new funding round. Ant originally invested in the 2016 round. The company will use the fresh capital to improve its mobile payments app TrueMoney Wallet as well as expand digital financial services across South-East Asia (it also operates in Indonesia, the Philippines, Vietnam, Myanmar, and Cambodia). TrueMoney is already the most popular app, with a 53% market share in Thailand. 

Looking ahead       

The Thai government has slightly revised its 2022 economic growth forecast to 2.7% to 3.2% from an earlier 2.5 to 3.5% growth range, citing a rebound in the crucial tourism sector, increased consumption, and exports. The Thai Prime Minister Prayuth Chan-Ocha told his Cabinet in early August 2022 that the economy will expand by 4.2% in 2023, the highest growth in five years.  

According to the World Bank, Thailand is an upper middle-income economy with a gross national per capita income of US$7,159.  

Thailand investment intelligence       

Readers may use the ASEAN Briefing search function at the top of the homepage to find more Thai business and investment intelligence. Just type ‘Thailand’ into the subject box. We also provide investment assistance and research into Thailand. Please contact us at [email protected] for assistance.   

Our 2022 Guide to Doing Business In ASEAN may be downloaded here.


ASEAN Briefing is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia and maintains offices throughout ASEAN, including in Singapore, Hanoi, Ho Chi Minh City, and Da Nang in Vietnam, Munich, and Essen in Germany, Boston, and Salt Lake City in the United States, Milan, Conegliano, and Udine in Italy, in addition to Jakarta, and Batam in Indonesia. We also have partner firms in Malaysia, Bangladesh, the Philippines, and Thailand as well as our practices in China and India. Please contact us at [email protected] or visit our website at www.dezshira.com.

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