Economy, Business And Markets

Thai Envoy Surveys New Areas of Interaction

Rasmee ChitthamRasmee Chittham

Thailand is trying to claim its share of the pie in the new climate following the opening up of Iran’s economy as a result of last year’s landmark nuclear deal by sending delegations and launching a direct flight between the two capitals.  

The state-run Export-Import Bank of Thailand (Exim Bank) offered financial services to support trading with Iran back in April, becoming the first Thai lender to do so following the UN Security Council’s removal of sanctions on Iran in January. Manas Jamveha, Exim Bank’s chairman said the move is in line with his government’s policy to explore and penetrate new markets.

Data released by the Islamic Republic of Iran Customs Administration shows Iran exported 234,600 tons of non-oil goods worth $85 million, including steel products, poly ethylene, seafood, pistachio, date and carpet, to Thailand during the first four months of the current Iranian year (March 20-July 21) – a 15% increase compared to the similar period in 2015. Meanwhile more than 116,200 tons of goods worth $80 million, including medium-density fibers, lift trucks, air conditioners and fruit juice, were imported from the southeast Asian country, which shows a 45% rise year-on-year.

Mehr News Agency met the Thai ambassador to Tehran Rasmee Chittham to learn about his views on the prospects of bilateral economic relations. Below is the full text of the interview:

In which areas do the two countries intend to develop cooperation?

Thailand and Iran are very close friends. Our historical ties date back more than 400 years. Last year, we celebrated the 60th anniversary of our diplomatic relations. The Thai government wishes to deepen and broaden cooperation in all areas, especially in trade, investment, energy, culture and tourism.    

Our deputy prime minister Somkid Jatusripitak visited Iran in early February. Even before his visit, the Thai foreign minister visited Tehran to attend 9th joint commission meeting. Since the Iranian nuclear talks have been successfully concluded, the country is now open to the world again. So, why don’t we expect Thailand to engage in more activities with Iran? Thailand has sent high level delegations to visit and discuss how we can promote closer cooperation and deepen bilateral cooperation in every area as the two countries have potential to do so.

As Thailand is the regional hub and second largest economy in ASEAN, Iran can take advantage of Thailand as a gateway in expanding its trade with ASEAN.

Thailand is also aware of the investment opportunities in Iran, especially in the areas of manufacturing, urban and infrastructure development.

Recently, several Thai companies as well as the embassy participated in the Iran Food and Hospitality Fair 2016. We hope to promote food and agricultural products particularly Halal Thai food products in the Iranian market.  

As Iran is well–endowed with oil and natural gas, Thailand sees great potential in developing cooperation in the energy and associated fields such as petrochemicals.

What are the prospects of interaction in the energy sector?

We need to import oil and gas because we are not an oil producer country. That is why Thailand relies on importing energy products from the Middle East. Iran is another option for us. We have to share the market to balance. Thailand does not want to rely only on the resources of one or two countries. Since we have very good relations with Iran, we seek to explore the possibilities to import from Iran.

We recognizes the great potential of Iran in the energy sector. Iran has the fourth largest oil reserves and the largest natural gas reserves in the world.

We are ready to resume energy cooperation with Iran. Such cooperation can include oil and gas exploration and production as well as trading in oil and related products.

My government is also interested in investing in Iranian petrochemical sectors. Currently, there is a joint venture investment of SCG, a Thai company, in the petrochemical industry in Asaluyeh, Iran.

Both countries need to exchange delegations to discuss how we can interact in doing this business for mutual benefit.

Could you elaborate on other areas of collaboration?

Tourism is another key area which will be beneficial to both countries. Thailand and Iran can work together to promote two-way tourism, especially with the opening of the direct flight between Bangkok and Tehran by Thai Air Asia Airlines on June 22. We also look forward to the opening of the direct flight of Thai Airways in October. This will surely enhance greater people-to-people relations between the two countries.

Even in food industry which Thailand is good at, we don’t want to compete with Iran but to cooperate.  Logistically, Thailand is a center for ASEAN Economic Community. As for Iran, the country is in a very good position. Chabahar Port, a free trade-industrial zone can be a transit center for goods being sent to neighboring countries such as Pakistan, Afghanistan and Central Asia.  

We also discussed the possibility of investment in the hotel industry in Iran during the visit of the Thai deputy premier, because your country needs at least 20 new hotels every year. However, at present, no Thai company is investing in this industry.

Furthermore, both countries can promote people-to-people contacts. A people-centered policy including cultural cooperation and exchanges are one of my priorities. These would enhance closer cooperation between our two countries.

Iran has a meager share of Thailand’s 200 billion-dollar market. What might be the new areas of activity for Iranian businesses in Thailand? Does Bangkok have any plan to attract Iranian investment?

Thailand welcomes Iranian investment, particularly in the areas which Iran is very progressive i.e. science and technology, pharmaceutical and nanotechnology.

In 2015, trade between Thailand and Iran was around $357 million, with Thailand having a surplus of $287 million.

The Thai government would like to encourage enhanced trade with Iran through the exchange of trade delegations, participation in trade fairs and organizing trade exhibitions. Thailand is also looking at the possibility of establishing distribution centers at the free and special economic zones in Iran.

Furthermore, during the visit of Jatusripitak in February, a trade agreement was signed to increase bilateral trade to $3 billion by 2021.

Thailand is also interested in promoting joint venture investment in Iran, particularly in the manufacturing of goods, food processing and fishery.