Thai-Russian trade yet to surge despite long ties
A VISIT by probably the biggest Russian trade delegation to Thailand in February this year can certainly be taken as a testament to Kremlin’s “Look East” policy. But how it will be translated into real trade or economic interaction between the two countries remains a challenge.
Thailand and Russia celebrate its 121st anniversary of diplomatic relationship this year. But as far as trade relationship is concerned, much is still left to be desired. However, the good news is that Thai-Russian relations in general has been on a gradual rise, especially after the meeting in Moscow between Prime Minister Gen Prayut Chan-O-cha and President Putin last year.
But while as many as 1.3 million Russians visited Thailand last year and trade value between the two countries has increased dramatically to top US$3 billion in 2017, Poj Harnpol, Charge D’affaires at the Thai Embassy in Moscow, admitted that Thailand still doesn’t figure prominently enough on Russia’s radar.
Only 30 per cent of the US$10 billion trade value targeted for 2020 under an agreement reached between Thailand and Russia has been achieved so far. Thailand’s export items to Russia are mostly automobiles, auto parts, rubber and food products while imports from Russia include crude oil and steel and metal products.
Speaking to a group of senior Thai journalists and executives of PTT Public Co Ltd visiting Moscow recently, Poj said Russia is still a market unfamiliar to Thai businessmen and investors who are deterred by its distance, language barrier, unclear rules and regulations. But for Thailand to play a more important role in its trade relations with Russia, it may need to come up with some major trade transactions.
“Probably what we need are some major deals with Russia in order to attract more attention,” he said, citing recent procurements of Russian aircrafts by Indonesia through a barter agreement.
Helicopters
Besides a purchase of a few Russian helicopters earlier, the Thai military recently signed an agreement to buy Russia’s renowned Kalashnikov assault rifles.
For historical reason, Vietnam is another Asean country that has a much closer diplomatic and trade relationship with Russia. Russia has been a major arms supplier for Vietnam, its staunch ally since the Cold War period.
Poj said the prospects for a more comprehensive Thai-Russian economic and trade relationship will be greatly boosted by a free trade agreement that Thailand is negotiating with the Russia-led Eurasian Economic Union. The trade union which was set up in 2015 comprises Russia, Kazakhstan, Belarus, Armenia and Kyrgyzstan.
He said as many as 30 countries are queuing up to join the trade group but Thailand is being given a priority.
While at present tourism is the main anchor in Thailand’s economic relationship with Russia, Poj said aiming for bigger trade with Russia should be one of its important dimensions as Moscow is increasingly looking eastward to circumvent sanctions by European countries.
