SFC Markets and Finance | Thai Scholar Chaiwat Meesanthan: To create niches for SMEs under the BRI

南方财经全媒体记者杨雨莱 广州报道

In October, leaders from China and the ten ASEAN countries announced that they've essentially wrapped up negotiations for the China-ASEAN Free Trade Area (FTA) 3.0, which is set to boost our economic and trade cooperation beyond traditional areas and into new frontiers, like digital and green economies.

Over the past decade, scholars of think tanks from China and ASEAN countries have come up with a bunch of policy recommendations to help build a high-quality model of the "Belt and Road" initiative in Southeast Asia. Since 2013, trade between China and ASEAN has been growing at an average annual rate of 7.5%, and in 2023, our bilateral trade hit $911.7 billion.

Chaiwat Meesanthan, the director of the Institute of East Asian Studies at Thammasat University accepted SFC journalist’s interview and considered that within the Belt and Road Initiative and FTA frameworks, it is crucial to create niches for SMEs to excel, extending beyond the scope of large-scale projects. 

During the interview, he emphasized that compared to the macro level of communication among national governments, people-to-people communication becomes more and more important in further deepening the cooperation of BRI.

SFC Markets and Finance: How to assess the current status of aligning the Belt and Road Initiative with the Master Plan on ASEAN Connectivity 2025 between China and ASEAN?

Chaiwat Meesanthan: For me, the progress between China and ASEAN at the policy communication level has shown significant a lot, stride market by increase the dialogue and collaborative framework aligning at the BRI with the Master Plan on ASEAN Connectivity in 2025. This alignment has facilitated on improving infrastructure projects, economics linkage and cross-border and facilitation.

However, challenge remains to ensuring balance benefit, or we can call a win-win situation that addresses regional concerns and maintains mutual trust for long-term sustainability. But the problem is, how we will showcase of win-win situation, not only for the government level, but we can show to the level of the people, you will get also the benefit of BRI in your own country, not only G-to-G. 

I can say that I am a representative of 99 people who don't know about the details of BRI.  What is the benefit to the people? We just know that there are a lot of mega projects under the BRI, a railway, port or highway, but what is the benefit of that to the people? The government will show that, it will make it easier. But how about the opportunity of the people in the community that the road cut the land of their own people? I think maybe there are a lot of problems too. We need to communicate more and more at the level of P-to-P, how the BRI can create an opportunity, especially jobs for people.

SFC Markets and Finance: How could we enhance the recognition of the BRI in the local community?

Chaiwat Meesanthan: I think for sure, they got the benefit in the level of, we could say that national interest is fine. But how we will promote the national interest to the people, that they will get the benefit, for instance, you can go easier to different places to make a trip. If you want to go to another country in Southeast Asia, a food or any product from your country to your neighbor country, it will be faster if you have a good transportation from the BRI. We must  explain more and more to our community by some kind of engagement with a society or some activities that the projects serve the society, the local community, we must do together, develop and take care of people in the local community.

SFC Markets and Finance: How do you view the progress of cooperation between China and ASEAN on green economy?

Chaiwat Meesanthan: And actually, when we are talking about a green economy, is one type that we can do in the future. Because we work a lot on infrastructure, and also infrastructure, they give an impact to environment. So if we do and make a balance between infrastructure and also the green economy, we show that we not only run infrastructure. The infrastructure will impact to environment, and we do the same in the green economy to balance it. I think maybe this is a good way for ASEAN and China that we do in the future.

SFC Markets and Finance: China and ASEAN have made new progress on the China-ASEAN Free Trade Area 3.0 in October, 2024. What impact do you think FTA 3.0 will bring to the cooperation between China and ASEAN?

Chaiwat Meesanthan: The substantial conclusion of the China-ASEAN FTA 3.0 negotiation on 10 October, 2024, marked a significant expansion in economic and trade cooperation between China and ASEAN. This upgraded agreement introduced enhanced commitment in areas such as custom procedure, trade facilitation, and economics and technical cooperation. It incorporates new area of the corporation, included digital economy that we never talked before, and included a green economy that we talked just now, supply chain connectivity and competition and consumer protection. And support for micro-enterprises, this is important because the micro, small and medium enterprises or SMEs or MMEs' enhancements are expected to foster a more inclusive and sustainable regional economy, and improve supply chain resilience, and support digital transformation within ASEAN and China.

Economy and supply chain is also important, and we focus on micro and small, not big (enterprises), because the big enterprises have their own way, they had their own platform. We have bilateral. And when we're talking about FTA, we must go to, like micro, small and medium (enterprises). 

SFC Markets and Finance: Why shall we pay more attention to the SMEs or MMEs during the cooperation?

Chaiwat Meesanthan: Because we cannot deny that now the company got the benefit from many states, like China-ASEAN FTA. Many of them from the big company, can make a road. Because who can make a construction of road or railway, must be a big company. The small and medium companies cannot be in the competition. So we must open another area for the small and medium. 

So now in BRI or in FTA, we talk mainly about a mega project, and the company that they have ability to make this project is a big one, so we must look for another opportunity for medium and small in this kind of FTA too. Maybe naturally food, but like a small company, a small and medium company, in the areas of food or fruit or something like that, or electric for the small and medium company.

SFC Markets and Finance: You mentioned that QR code payments are becoming more popular in Cambodia. How can China and ASEAN strengthen cooperation in digital transformation under the BRI? 

Chaiwat Meesanthan: Actually the QR code, when we think about QR code, very simple. But, simple is important. When I came to China, if I have no Alipay, it's difficult to use your own life in China. When the people in China, they came to Cambodia, they just a scan and they can pay. So this a very easy way. Actually, if you want to start something, we will start by look in the future and very high level. But actually, the good way is back to the basic, make the day of life simple.

Come to Thailand, easy to pay, no need to go to currency exchange, you can pay by using your phone, like in your country. But now, not many countries that we can use QR code. That's why I‘m trying to show make it simple. Because, if you ask for the expertise in Thai or ASEAN relation, they don't talk about this because this is very microeconomics. But they will talk about macro-economy, the big project, the impact of society.

But as I told you, payment is very important. Actually it's in a level of our people or tourists. If you want to go to Thailand, and you can use your phone, no need to exchange the money. How easy of your life. You can scan or like us when we come to China, it's difficult if you have no Alipay, very, very hard. And some application, like if you want to call the taxi, I come to China is a zero, I have no anything to understand because it's Chinese if we have some very easy application, that we can use to join both in Thailand and in ASEAN and in China, if you can call taxi with this app in China and also in ASEAN. When you go to ASEAN, you also can use this app like Grab, go to every country you can just Grab. We look on the possibility on this cooperation. But as I told you, this is a micro perspective, I don't want to talk too much on macro, because the macro is too much talk in the level of equities and government, but I'm trying to make the people and government see the opportunity that we can do for our people, and make people understand what we do by making it basic.

SFC Markets and Finance: Given the current trend of global industrial chain restructuring, how can China and ASEAN enhance cooperation and integration in industrial and supply chain through the BRI?

Chaiwat Meesanthan: China and ASEAN actually can enhance the cooperation in integration industry and supply chain through the BRI, by jointly investing infrastructure that support official logistics and connectivity, the strengthening trade agreement are promoting industry, can facilitate a smooth supply chain operation, sharing technological innovation and best practice. This is very important, because if we can share the technological innovation and best practice in manufacturing and sustainability, we brought a productivity and additionally fostering public partnership, and aligning policy for a streamlined customs procedures will further integrate the industrial and also supply chain, ensuring resilient and adaptability among global industry and restructuring in ASEAN and China.

SFC Markets and Finance: According to incomplete statistics, there are about 1,000 Chinese-invested enterprises in Thailand. What are the main areas of Chinese investment in Thailand?

Chaiwat Meesanthan: The main area of Chinese investment in Thailand, including infrastructure development, renewable energy, manufacturing and automotive industry, particularly in electric vehicles, that is the most important. Additionally, Chinese investments are significant in real estate and technology and telecommunication sectors, supporting Thailand's economic growth and technological achievement. Very, very popular in Thailand, but actually popular in the city, because of the problem of EV cars is, EV cars are available for a big city, but in the local area or rural area, it's a little bit difficult with EV car, the charging electric, or road, or maintenance. So we can see that in the city, like Bangkok, Chiang Mai, a big city in Thailand, where it's okay for EV car, very popular in EV car.

SFC Markets and Finance: In what areas wil China and Thailand have more cooperation opportunities？

Chaiwat Meesanthan: I think maybe in the charging station. We're talking about EV car, but now not too many charging stations, so China can go to Thailand and make charging station for EV car, at the time, from south to north, from north to north-east. I think this is also one opportunity that we can do together. We can invest only EV car stations, now we have petrol, and in the petrol station we have two or three charging for EV cars. But you think, for a long holiday, when a lot of people back home how we are waiting for the EV car charging. One we use at least 30 minutes, 15 minutes each. So this is a big problem of EV car. So a good opportunity for EV car is that is charging station. The process of charging is faster than before. So this is one, I think maybe we waiting for the next upgrade of innovation of EV car, especially in charging station and charging system. 

And the second is, it's cheaper than petrol, if we compare, especially when my friends use the EV car monthly. They calculate in one month, it's cheaper than you use a petrol car, 10,000 baht, it's cheaper, 10,000 baht, they can pay for buying the EV car. So they use five year is enough. So I think maybe this is also a good choice for the people for now. But I must say that it‘s actually in the big city or capital city.

SFC Markets and Finance: In 2025, China and Thailand will celebrate the 50th anniversary of the establishment of diplomatic relations. What prospects do you foresee for the cooperation between China and Thailand?

Chaiwat Meesanthan: As you know, the 50th anniversary of diplomatic relations in 2025 marks a significant milestone, symbolizing the strong and enduring partnership between Thailand and China. But actually, the relationship between Thailand and China started 1000 years ago. Because we have a lot of Chinese people who came to Thailand since many hundred, or a thousand years ago, but it’s 50th anniversary after you found the relation, and you found a country, right? This cooperation is highlighted by decades of mutual trust, economic collaboration and cultural exchange, you cannot deny that culture exchange is also important, And looking ahead to future cooperation, it's likely to focus on deepening ties in areas such as trade, technology, as I told you, and one is green energy and regional connectivity under the BRI also strengthen collaboration in digital transformation, sustainable development, and especially in future, solidify their strategic partnership and contribute to regional stability and prosperity.

But at this time actually, we can upgrade the relation, especially P-to-P. I suggest that we can invite some very popular YouTuber or very popular influencer to the beautiful place in China. We only invite one and show the easy life or how beautiful, how we can get a good hotel and good toilet. Because we cannot deny that when we're talking about tourists and travel to China, the big problem the people ask about whether toilet is good, something like that. So we showcase on this, very easy, you pay for influencer to come, and after that, 1000, 10000, 100000 or a million people will follow by just paying for one, so this is a very easy way.

But because of we talk in deep, in the level of expertise, the easy way that we can make the people understand in the P-to-P like this, we don't think on this. So I think for me, as as I told you, I'm not the expertise in China-Thailand relations. But I can show you the difference in the level of normal people. How do they think? And how we can use the opportunity, this opportunity for upgrading our relations in kind of P-to-P, not G-to-G. And after that, I think maybe this is one of the things that we call soft power.

SFC Markets and Finance: Four years have passed since the signing of the Regional Comprehensive Economic Partnership (RCEP). How do you view the implementation of RCEP? 

Chaiwat Meesanthan: We cannot deny that the collaboration between China, ASEAN, and this area, we have many states, bilateral, multilateral, ASEAN+3, ASEAN+4, ASEAN+1. The problem is which one you want to do, or which kind of state that you use for something, but this is still confusing. Actually we must be back and rethink on the collaboration, this state is for what, if we don't do like this, we will also confuse, you will do in the state of RCEP, or you will do in the state of FTA, or you will do in the state of APEC or FTA, bilateral or multilateral.

We're confused now because of a lot of states, a lot of states that we use for showcase many cares. So this is a big problem. So RCEP is one of the states, but actually RCEP is very big, and 30% of the world's GDP, one-third of the GDP of the population in the world. But it's still not too much impact in kind of collaboration, because we have many states that we pay, especially when your government, some expertise and consultant of the government, this one we use BRI, this one we use FTA, what is important of RCEP, important but no opportunity for RCEP. So that's why I said that better we use RCEP for medium and small businesses. Because big businesses or big companies, they go to FTA, but we use RCEP for medium and small. This is also opportunity for RCEP in the future, in my opinion. 

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