Online trade with China beckons
Beijing the only large economy to grow in 2020
China has bounced back economically from the pandemic, with an upsurge in trade with Thailand last year, opening the door for Thai producers struggling with low demand elsewhere to pivot towards the mainland, particularly via e-commerce, say officials and trade networks.
Pongsak Laoswatchaikul, a planning and policy analyst at the Industry Ministry’s Office of Industrial Economics, said Thai-Chinese trade has surged to almost US$70 billion a year and the government has a target of $120 billion on the radar.
“China is the only one of the 10 largest economies to record economic growth during the pandemic,” said Mr Pongsak.
China has managed to reduce poverty to some extent, which improves people’s purchasing power and many of them have turned to online platforms for purchases, he said.
Mr Pongsak said Thai producers must step up their efforts to become part of Chinese supply chains and increase sales, particularly in industries featuring advanced technology, such as smart electronic gadgets, futuristic vehicles, biotechnology and medical appliances.
He was speaking on Friday at a panel discussion, part of GMS Thailand E-Commerce Economic Corridor International Conference, jointly established by the Thailand Convention and Exhibition Bureau (TCEB) along with local and Chinese partners. The event, which promotes Thai products in China’s markets and business matching, runs until Monday.
Sakarn Saensopa, head of the Chinese unit at the Department of International Trade Promotion, said Thai producers should consider supplying outstanding products to cater to niche markets. These would include natural products, he said.
They also need to create branding, making it easier for Chinese traders and consumers to recognise and trust their products.
“It is common for Chinese partners who may want to visit our factories to carry out checks or befriend Thai suppliers before doing business together,” said Mr Sakarn.
Salanroj Sutaschuto, director of TCEB’s central and eastern office, said China’s online trade is valued 12 trillion yuan (56.8 trillion baht), with 30% of this amount food and consumer products.
“Covid-19 has stimulated online purchases,” he said.
Yongwut Saowapreuk, head of a steering committee for agricultural and food support under the Agriculture and Cooperatives Ministry, said the pandemic has provided room for farm producers to think about improving product quality. Farmers must ensure their crops are safe for export as the country is ranked the 11th largest food exporter in the world, he said.
Shipments between Thailand and China could transit through Myanmar, Laos, Cambodia and Vietnam, said Adul Chotinisakorn, a representative from the Digital E-commerce Thai-Asean Association.
Trade solely across land borders between Thailand and China registered 20% year-on-year growth to 238 billion baht in 2020.
“This is the opposite of what happened in global trade,” said Mr Adul.
Fruit ranked the top export category to China, he said.
Prinn Panitchpakdi, an adviser for the Thai Economic Corridor Cooperation Association, said the rise in digital usage has opened the door to trade via digital platforms.
Thai producers must observe what foreign markets want in terms of products to be able to supply items that suit demand.
“Thai product quality needs to be scaled up,” he said. “Chinese people want products that meet international standards.”