Due to the strategic geographical location of Thailand, China has been promoting economic and trade cooperation with Thailand in recent years to advance its “One Belt, One Road” initiative. The two countries have now established a comprehensive strategic partnership and strengthened cooperation in multiple areas such as agribusiness, railway connectivity, grain, flood control, and drought relief. They even signed an agreement in 2015 to grow the bilateral trade volume to $100bn.
That said, Chinese investors are advised to take into consideration the following political risks when investing in Thailand:
Thailand suffers from poor political stability and continuity due to the influence of military junta over the country. As a result, Military coups surface from time to time;
China-Thai trade relationship may be weakened in the future due to a US-Thai Alliance. The U.S. has been wooing many Asia-Pacific countries to join in the regional economic integration programs led by it;
In recent years, Bangkok and Phuket Island, favorites with foreign investors, have suffered frequent terrorist attacks;
The Yala province located in Southern Thailand has experienced social instability due to complex ethnic conflicts- posing direct life threats and great challenges to social security and economic development in that region.
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