By Shi Guang, Phoovasit Phirarhdithsayasak
The year 2018 marked the 40th anniversary of China’s reform and opening-up as well as the 15th anniversary of the China-ASEAN strategic partnership. The year 2019 marks the 70th anniversary of the founding of the People’s Republic of China. Thai conglomerate Charoen Pokphand Group (CP Group or Chia Tai Group) has been a special overseas investor since China’s reform and opening-up. In an interview with China Report ASEAN, Thanakorn Seriburi, senior vice chairman of CP Group and chairman of Thai-Chinese Promotion of Investment and Trade Association, shared his views on the impressive developments in China in recent decades.
China Report ASEAN: China’s Belt and Road Initiative has shown impressive strength, and Thailand 4.0 and the EEC (Eastern Economic Corridor) are also strong. How do these strategies benefit Thailand?
Thanakorn Seriburi: I think China devised the Belt and Road Initiative because the country looks to the future. China aims to “go global” by distributing goods and cooperating with countries around the world. The path around the world is the same as it was millennia ago—the Silk Road both by sea and by land. As China has been developing over the last 30 to 40 years, the country has applied knowledge from abroad to develop its own intellectual property as well as purchasing methods and businesses outright. Now China conducts its own R&D. China can develop and advance its products into world-class competitive products. When the Chinese market is no longer enough for ever-expanding Chinese companies, their products will have to reach world standards. China must turn to the world market. And to survive in the world market, China must arrive on the world stage with three “readiness” in hand: The first is technology, the second people and the third capital.
China’s Belt and Road Initiative parallels the EEC project, which focuses on developing the eastern region of Thailand, in many ways. While many countries face economic problems, the Thai economy has been thriving. So, if Chinese businesses seek to invest in Southeast Asia, they are likely to choose Thailand.
China Report ASEAN: Last year marked the 40th anniversary of the reform and opening-up of China. CP Group has been attractive to Chinese businesses. What factors have made CP Group successful in China?
Thanakorn Seriburi: At CP Group, we are very familiar with China. We are the first brand to invest in China after 1979. Thanks to our early entry, CP has many friends in business circles. So, I can confirm that when China looks to invest in Southeast Asia, Thailand definitely first comes to mind, and they usually first think of CP as well.
Something I want to say to China about moving the Belt and Road Initiative forward is that if Chinese businesses want to succeed overseas, China may want to think about how CP has been doing in China, which calls focus to our “three benefits”: First, benefit the nation and the host country. Second, ensure that people of both countries benefit. Lastly, benefit the company. This is how CP prioritizes its operations.
China Report ASEAN: This year marks the 15th anniversary of the establishment of a strategic partnership between China and ASEAN. CP Group is part of this strategic partnership. How is cooperation between China and ASEAN going so far? And what waits on the horizon?
Thanakorn Seriburi: When talking about ASEAN, we can focus on the trading arena. Thailand’s economy has always been good, but about five years ago, it was disrupted by unrest, whereas our ASEAN neighbors of Malaysia, Indonesia, Cambodia and Vietnam began booming and became more competitive. But now that Thai politics has calmed down and its national strategy has been aligned with its strategic partnership with China, Thailand is back in a big way. In fact, the strategic partnership between China and ASEAN means China and ASEAN are ready to help each other. But I think Thailand has more smart people. If foreigners want a joint venture in ASEAN, Thailand should be the first place to look, especially for Chinese investors. Why? First, Thailand is close. Second, Thai politics is stable. And third, Thailand has good policies for foreign investors.
In terms of development, I think countries must operate like businesses to some extent when considering economics and foreign enterprises’ potential partners. With more sales avenues, the economy will certainly grow. When the economy expands, the country gains more power.
China Report ASEAN: What advice do you have for Thai businessmen seeking to invest in China considering the opportunities created by the alignment of the two countries’ respective strategies?
Thanakorn Seriburi: World Bank announced that the world’s GDP will shrink by 1 percent, so the market will shrink. When the market shrinks, any investment must be studied thoroughly. When the market is smaller, competition is fiercer. Another issue is whether a product fits the needs of a market.
Thai businessmen investing in China must study the provinces of China to know where to invest. For example, if they invest in manufacturing in Shanghai, they will hardly be able to compete with the proficiency of local enterprises. However, there are many other more obscure places where they can do very well. So, the opportunities for Thai people are difficult to identify. But Shanghai does have something in high demand: service industry. Many Shanghai residents are wealthy professionals with considerable earning power who seek relaxation. If Thai people look to do business in Shanghai, they must provide what Shanghai lacks: services in the form of Thai food or labor in sectors such as senior care. But for manufacturing, Thai investors need to find a peripheral locale where the economy is less mature.