ASEAN business opportunities

Visa-free facilitation is greatly promoting personnel exchanges between China and Southeast Asian countries. Southeast Asian countries have become popular tourist destinations for Chinese tourists, more Chinese enterprises have invested in Southeast Asia, and trade between China and ASEAN countries has become increasingly close. China's economy continues to improve steadily and has increasingly become a stabilizer for the economy of Southeast Asia and the world at large.

According to the statistics of the Ministry of Culture and Tourism, affected by favorable factors such as policy, supply and publicity, urban and rural residents in China have a strong willingness to travel during the Spring Festival this year, and a number of indicators such as the number of trips and spending have hit a record high, of which about 3.6 million outbound trips are made, and Southeast Asian countries are favored by people with geographical advantages.

Li Wenhua, director of the East Asia Department of the Tourism Authority of Thailand, said in an interview with Chinese media that the number of Chinese tourists reached 210,000 during the Spring Festival, which not only exceeded previous expectations, but also returned to normal levels of consumer spending, bringing 6.213 billion baht in tourism revenue for Thailand, an increase of 366%. Data from the Tourism Authority of Thailand shows that as of February 25, the number of Chinese tourists to Thailand has exceeded 1.11 million, more than one-sixth of the total number of foreign tourists to Thailand, and is the largest source of foreign tourists in Thailand. In the context of China's entry into the "visa-free era", Thailand is expected to attract more than 7.2 million Chinese tourists this year, which will be 104% more than 2023.

On January 28 this year, China and Thailand signed a mutual visa exemption agreement, making Thailand the third country, after Singapore and Antigua and Barbuda, to exempt visas for ordinary passport holders from each other this year. Prior to this, Thailand has implemented a unilateral visa-free policy for Chinese tourists in September 2023. Since December 1, 2023, China and Malaysia have implemented mutual visa exemption measures, Tourism Malaysia is increasing the frequency of bilateral flights and other strategies, hoping to take advantage of the 50th anniversary of the establishment of diplomatic relations between China and Malaysia to achieve the goal of receiving 5 million to 7 million Chinese tourists. So far, 23 countries have implemented such arrangements with our country. The visa-free arrangement is greatly promoting personnel exchanges between China and relevant countries.

According to Ctrip data, Thailand, Singapore, Malaysia, Indonesia, Vietnam and other Southeast Asian countries are among the top 10 most popular outbound destinations for Chinese tourists during the Spring Festival, and the "New Malaysia and Thailand" travel orders during the Spring Festival increased by 30% compared with the same period in 2019, and increased by 80% compared with the "May Day" small holiday in 2023. According to Alipay outbound tourism data, the amount spent by Chinese tourists in "New Malaysia and Thailand" during the Spring Festival increased by 580% compared with the same period in 2023.

The continued steady improvement of China's economy is stabilizing Southeast Asia's economic rebound expectations from all aspects. The ASEAN, China, Japan and South Korea (10+3) Macroeconomic Research Office (AMRO) reported in January that the Southeast Asian region is expected to achieve overall economic growth of 4.9% in 2024, of which the Philippines, Cambodia and Vietnam are expected to reach or even exceed 6% economic growth, far exceeding the global average. In the World Economic Outlook Report released by the International Monetary Fund (IMF) at the end of January, the global economic growth forecast for 2024 was slightly raised to 3.1%, and China's development growth rate was raised to 4.6%. The IMF believes that the adjustment reflects the continuation effect of China's stronger-than-expected economic growth in 2023, and also boosts confidence in regional economic growth, emerging Asia's overall economic growth this year is expected to reach 5.2 percent. China remains the biggest engine of global growth.

AMRO believes that the continued steady improvement of the Chinese economy will provide additional impetus for regional economic growth. While slower growth in the US and Europe could limit the extent to which Southeast Asia's exports improve, a gradual recovery in China's property sector and a rapid recovery in tourism will strongly support regional growth, the report said. China's industrial production grew at its fastest pace since February 2022, services continued to grow, personal consumption remained strong, retail spending strengthened, and additional policy support spurred infrastructure investment, including post-disaster reconstruction, which is expected to reinforce recent economic momentum.

Recently, the General Administration of Customs updated the list of registered orchards and packaging factories of fruits exported to China in Cambodia, and coconut became the first high-quality agricultural product approved to be exported to China in Cambodia in 2024. In this process, China has continuously accelerated the work process, and it only took more than half a year from the consensus reached by the leaders of the two countries to the completion of the whole process. The continuous opening up of the Chinese market has provided important support for Cambodia's economic development, especially agricultural modernization.

This year marks the third year of the implementation of the Regional Comprehensive Economic Partnership (RCEP). China and ASEAN have been each other's largest trading partners for four consecutive years, with bilateral trade volume reaching 6.41 trillion yuan in 2023. At the "China-Asean and RCEP related Countries Business Symposium" held not long ago, the participating experts believed that RCEP has injected a strong impetus to regional economic integration, benefiting the economies of regional countries, more and more enterprises to share the dividends of the regional super-scale market, and the industrial chain and supply chain are more closely connected. On this basis, the two sides are also negotiating version 3.0 of the China-Asean Free Trade Area. Wang Shouwen, international trade negotiator and Vice Minister of the Ministry of Commerce, said that China is willing to work with ASEAN parties to complete the negotiations as soon as possible, further enhance the level of trade and investment liberalization, expand practical cooperation in emerging areas such as intermediate goods trade, digital trade and cross-border e-commerce, and create a broader space for regional development.

In addition to growing trade ties, more and more Chinese companies are investing in Southeast Asia, and China is already the largest source of foreign investment in several Southeast Asian countries. Taking into account policy support, industrial factor accumulation and industrial layout, MG, Great Wall, BYD, Nezha and other new energy vehicle companies are accelerating to "enter" Thailand, not only to meet the local demand of one of the largest auto markets in Southeast Asia, but also to serve the global market as a base. At the beginning of the New Year, A-share listed companies Henan Zhongyuan Internal Distribution Co., Ltd. and Hefei Xinacer Microelectronics Equipment Co., Ltd. issued an announcement announcing the investment and establishment of factories in Thailand. Since December 2023, more than 10 A-share companies have disclosed matters related to the establishment of subsidiaries or capital increases in Thailand.

Against the backdrop of intensifying geopolitical tensions and countercurrent economic globalization, the recovery of the world economy is fragile and weak. On the other hand, China's economy continues to stabilize and improve, increasingly becoming a stabilizer for the Southeast Asian region and even the world economy, and continues to contribute valuable certainty to this uncertain world.