ASEAN Beat | Diplomacy | Southeast Asia

Thailand’s Post-Pandemic Dance Between the Major Powers

As the threat of COVID-19 fades, Thailand will face tough choices in its regional and international alignments.

By Daniele Carminati for
Thailand’s Post-Pandemic Dance Between the Major Powers

Thailand’s Prime Minister Prayut Chan-o-cha attends a G77 Meeting at the UN General Assembly on July 26, 2016.

Credit: Flickr/Cancillería del Ecuador

For a number of reasons – from its timely response to simple luck – Thailand has successfully weathered the outbreak of the coronavirus pandemic. It has managed to contain the spread of COVID-19 infections, clocking up 100 days without any confirmed local transmissions of the virus. But this success has come at a high economic cost, one that threatens to disrupt the country’s relations with major outside powers. Moreover, the recent discovery of an anomalous COVID-19 case has resulted in further delays to the country’s reopening.

There have been a plethora of articles and analyses questioning whether the ongoing closure of Thailand’s borders to the majority of foreign visitors is going to create more economic troubles than a partial opening. The latter option has been implemented in parts of Europe, but has been followed in some cases by a fresh wave of infections. The border closure is particularly detrimental for a country like Thailand, where tourism contributes anywhere between 10 and 20 percent of gross domestic product annually.

While it is too early to draw conclusions, more than 4 million Thais are currently unemployed and as many as 14 million people are expected to be out of jobs if drastic action is not taken before the end of the year. Connected to this economic hardship is the rising wave of public protests calling for the resignation of Prime Minister Prayut Chan-o-cha and the drafting of a new constitution, among other sensitive and controversial requests.

How does all of this play into the Kingdom’s future relations with the major powers? Thailand is commonly known for its accommodating foreign policy, in which it has balanced adroitly between outside powers and sought good relations with each, in spite of political differences. But in the post-COVID-19 climate of growing superpower rivalry and tension, the country’s decisions should be pondered even more carefully. Upcoming events – such as the U.S. presidential elections in November – will require Thai leaders and policymakers to review or renew their bilateral relations with several major powers.

The European Union might not be the first international actor that comes to mind when one thinks of Thailand, but it nonetheless has close and diverse ties with the country. Beyond reopening talks into a possible free trade agreement, development assistance, and collaborations on environmental and social policy, the EU contributed more than 11 percent of Thailand’s tourists before the pandemic, according to statistics.

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Still unwilling to open the country to mass tourism, Thai authorities have recently advanced a plan to attract European retirees to the country. Although some reports have highlighted that Thailand might not be as welcoming and affordable as it once was, a well-executed plan is likely to attract seniors eager to settle down in a tropical country that has so far managed to limit the spread of COVID-19. The move would be much welcomed by newcomers, as well as by retirees who have been unable to return because of the current restrictions. More broadly, it would help strengthen relations between Bangkok and Brussels.

In Japan, a country boasting a long and fruitful history of relations with Thailand, Prime Minister Abe Shinzo has just announced his resignation due to lingering health issues. Japan-Thai relations have been stable for decades, involving mutually advantageous economic and sociocultural exchanges. This is exemplified by the number of Japanese factories scattered across the country as much as by the Thai people’s widespread admiration for everything Japan, from its food and fashion to its music and anime films. It is unlikely that Abe’s successor will have a negative impact on bilateral relations and existing sociocultural interactions, but Japan might still be caught between the Sino-American rivalry which could put pressure on the country and its leaders to take a more definite stance, one that Thailand will seek to avoid.

While Japan’s elections are not expected until late 2021, the U.S. presidential election is fast approaching on November 3. Several Asian countries have lamented Trump’s “America First” doctrine, which has alienated allies and partners, and instilled widespread uncertainty about Washington’s commitment to the region. These concerns were further exacerbated by China’s growing assertiveness, most notably in the South China Sea, but also in Hong Kong, or in its increasingly confrontational stance towards Taiwan.

In spite of reassuring words from the American ambassador to Thailand, the re-election of Trump would mean four more years of uncertainty for the Kingdom and its Southeast Asian neighbors. Meanwhile the competing candidate, Joe Biden, is likely to revert to a more robust version of the Obama administration’s “rebalance” to Asia policy. Observers have already emphasized the need of a new American president to “win back Southeast Asia,” and Thailand, as a formal treaty ally, might be willing to reconfirm old bonds should the need arise.

Last but not least, Thailand’s handling of China can arguably be seen as the country’s most delicate bilateral relationship, due to its paramount economic and political importance to the region. The two countries share entwined histories of economic and cultural exchange, which have been marked by multiple waves of immigration from southern China. This has resulted in a sizable presence and influence of ethnic Chinese at the upper echelons of Thai politics and business.

More recently, China has become the number one source of tourist arrivals to Thailand, contributing as much as 40 percent of arrivals in the past few years. Although this relatively sudden influx has created some issues, including the rise of exploitative “zero-dollar tours” targeting Chinese visitors, Thailand has in general managed to adapt to the sudden spike in arrivals from the Chinese mainland. However, there were growing concerns about this apparent overreliance even before the pandemic hit, a question which is now likely to become even more pressing.

Beyond tourism, China’s footprint across Thailand can also be seen through the increasing number of infrastructure developments, many grouped under Beijing’s ambitious Belt and Road Initiative (BRI) connectivity scheme. Among the welter of bridges, dams, and highway, the flagship BRI project in mainland Southeast Asia is arguably the high-speed railway that aims to connect the city of Kunming in southern China to Singapore, via Laos, Thailand, and Malaysia.

The rail project has been marked by repeated delays, but the first stretch running from the Chinese border to Vientiane, the capital of Laos, is scheduled to begin operations in 2021. Nearly crossing the full north-to-south length of Thailand, the project has been divided into multiple sections which will open at different stages.

The implications of this major railway artery have been discussed extensively in recent times, especially following the introduction of the BRI, and it is hard to deny the profound economic and even geopolitical impact that it would have on mainland Southeast Asia. The risks of taking on too much Chinese debt, and the granting of track-side concessions to China, are often debated, but Thailand is in a relatively good position to dictate the terms of its engagement with BRI, at least when compared to poorer neighbors such as Laos, Cambodia, or Myanmar.

All considered, Thailand cannot risk foregoing nor downplaying any of its existing relations with major global powers, and it will have to perform a careful “dance” among them in the period that follows the waning and aftermath of COVID-19. In the uncertain months and years to come, Thailand will have to reassure its powerful partners that it is still a welcoming country for tourists and retirees, as well as for foreign investors.

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Such a multipronged approach would entail developing and implementing Thailand’s advertised “Safe and Sealed” strategy for tourism, reopening the borders to at least selected investors and businesspeople, and being one of the first countries to engage the soon-to-be-elected successor to Abe. It would also require the Thai government to avoid upsetting either the U.S. or China, while maintaining a judicious balance of economic and strategic ties with both. And all of this would have to be done while facing growing domestic pressure to address unemployment, and rising calls for far-reaching political reforms. After all, a country in turmoil is not appealing to either tourists or investors.

Ultimately, Thailand has already shown that it has the ability to benefit both from competition and cooperation among major powers. The Kingdom is accommodating but proud, and will not easily bend to any outside power’s will, especially when it is perceived as overbearing and patronizing. Owing to its strategic geographical position and role within the Association of Southeast Asian Nations, Thailand is in a relatively favorable position in the midst of intensifying global disputes. But finding a balance between domestic and external challenges might require changes and decisions that the country may not be ready to make – at least not yet.

Daniele Carminati is a PhD candidate in Asian and International Studies at the City University of Hong Kong. His interests revolve around the impact of globalization and the ensuing trends and issues across East and Southeast Asia with a particular focus on soft power dynamics.