Focus on mainland SE Asia trade, urges Chula's Thitinan
Thailand should place more emphasis on trade and investment in mainland Southeast Asia to boost growth and expansion, said Thitinan Pongsudhirak, director of the Institute of Security and International Studies at Chulanlongkorn University.
"The AEC [Asean Economic Community] will always be here as long as Asean exists. But the AEC will not be able to sustain Thailand forever," Mr Thitinan said during a recent seminar on the AEC in Bangkok. "In future decades, mainland Southeast Asia, with its concentric frames of economic development, will become [lucrative] for Thailand," he said.
The future of Asean economic cooperation lies in intra-regional investment more than inter-regional trade, he said, adding Asean's economy can move forward as a single production base while making deals with countries outside the region.
Asean is the fastest growing region in the world, with soaring levels of gross domestic product, yet it still relies on external markets, he said. Over the past 25 years, intra-Asean trade has hovered around 24-25%.
Thailand benefits greatly from its strategic location as the heart of the region.
In the Greater Mekong Subregion, which consists of a US$1.1 trillion market and population of 335 million, Thailand is at its centre.
Similarly, among its neighbours, Cambodia, Laos, Myanmar, Vietnam and Thailand, Thailand is the key driver of the region's economy, contributing half a trillion dollars to the collective GDP.
Physical connectivity is key to enhancing trade and investment in the region. More connectivity from projects such as rail and roads with cooperation from China and Japan will play an important part in connecting mainland Southeast Asia, said Mr Thitinan.
He added that if mainland Southeast Asia is connected to the southern part of China, it would create a global supply chain beneficial to the future of Asean economic integration.
Piti Srisangnam, professor at the Faculty of Economics, Chulalongkorn University, said conducting trade within the region is more cost-effective and a way to divert risk from global markets.
This region is a new market with a high growth rate, he said.