THAILAND plans to create a regional fund along with several of its neighbours in order to reduce reliance on Chinese investment in Southeast Asia.
The Nikkei Asian Review reported earlier this month that Bangkok hopes to launch the fund “as soon as possible”, which would help fund infrastructure and development projects in Thailand, Cambodia, Laos, Burma (Myanmar) and Vietnam.
Prime Minister Prayuth Chan-ocha is expected to propose the idea to leaders of these nations the 8th Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS) Summit on June 16, a forum for cooperation on issues including trade, transport and investment.
China has funded major infrastructure projects in Southeast Asia under the Belt and Road Initiative including the Sino-Thai railway for which construction began in December 2017. Beijing aims to establish a China-Indochina Peninsula Corridor which will run from southern China to Singapore.
Thailand’s proposed regional fund for the Mekong countries would provide funding for projects under ACMECS’ 2019-2023 master plan, aimed primarily at increasing connectivity between the five nations through trade harmonisation and improved infrastructure.
In January, China pledged $800 million in development assistance for Laos and has previously pledged $615 million for improvements to healthcare over the next three years.
It has also invested heavily in Cambodia, where growing Chinese influence has emboldened Prime Minister Hun Sen to crackdown against political opposition and the media.
“Many of the countries in the region, while they welcome investment from certain countries, they want to keep a balance … not [to rely] on only one country,” said deputy permanent secretary of Thailand’s ministry of foreign affairs as quoted by the Nikkei Asian Review.
“The increasing dependence on China is a big issue in Asean,” said Professor Prapat Thepchatree at Thammasat University. “Myanmar, Laos and Cambodia have been relying heavily on investment and trade but that comes with a trade-off of their economic freedom.”
Local concerns about rising Chinese influence in the region have, however, been dismissed by China as “outdated” and “irresponsible”.
“It represents a serious misunderstanding of China’s opening-up policy, which adheres to developing extensive economic, trade and technological exchanges and cooperation with countries and regions on the basis of equality and mutual benefit,” argued the Global Times in a January editorial.
China has been Asean’s largest trading partner since 2009.