Economy, Investment and Trade
Thailand to protect local industries by curbing bypass practices from foreign firms
(30 July 18) Thai trade officials will meet the United States customs to discuss ways to thwart bypass methods used by Chinese exporters who direct goods to Thailand in order to avoid higher US tariffs. Both parties will work together to outline Thai goods that will soon face levies from US tariffs imports and the quantities of the products exported every year. Recently, the Foreign Trade Department cooperated with the Customs Department to implement stricter imports and export controls especially on goods which are subject to high US tariffs. The move is to prevent Thailand from becoming a dumping ground for Chinese goods subjected to US tariffs hikes and anti-dumping measures which could harm local industries. An official from the Thailand’s Foreign Trade Department claimed that the US is concerned that certain foreign enterprises may shift its production bases to Thailand and re-export to the US due to President Trump’s’ decision to impose a 25 percent tariff on steel and 10 percent tariff on aluminium imports into the US on 8 March 2018.
Myanmar hopes for progress as China-backed Kyaukphyu megaproject negotiations resume
(30 July 2018) According to Myanmar’s deputy finance minister, an agreement has been made to scale down the China-backed Kyaukphyu megaproject from over US$7 billion to a projection of under US$1 billion. The implementation of the project will be supervised by Chinese consortium company, CITIC Group in the Rakhine State. The deep-sea port project which has been put on hold for more than three years has been heavily criticised because of its potential to put Myanmar heavily indebted to China with the unfair contractual agreement, that is 15 percent share for Myanmar and 85 percent on the CITIC-led group. The current government of Myanmar insisted on a 30 percent share which was then agreed by the Chinese consortium. The agreements are expected to be signed soon.
Vietnam surpasses Malaysia, becomes China’s biggest trade partner in ASEAN bloc
(29 July 2018) Among the ASEAN member states, Vietnam has taken the top spot as China’s largest trading partner for the first time from Malaysia. China-Vietnam revenue in June is US$11.2 billion, surpassing China-Malaysia revenue of US$9.3 billion. Malaysia was China’s largest trading partner from 2008 till 2015 and 2017. In the first half of the year, trade between China and Vietnam increased by 28.8 percent compared with the same period last year, 13.3 percent higher than the trade between Malaysia and China. Chinese Embassy in Vietnam said it is working together with the border provinces’ authorities to enhance the process of import of Vietnamese agricultural produce into China due to overwhelming growth of commodity exchange between the two countries.
Alibaba launches second availability zone to meet increasing demand in Malaysia
(30 July 2018) Alibaba Cloud, a subsidiary of Alibaba Group Holding Limited, has set up a second availability zone in Malaysia (Availability zone B) to expand its cloud data centre footprints as the regional demand for the digital services boom. Alibaba Cloud would further invest in Malaysia to set up the first cloud-based Anti-DDoS Scrubbing Centre in August. The new centre will offer new services to protect businesses from cyber threats and safeguard its customers’ information. Availability Zone B also will provide payment hardware security modules (HSM), elastic computing, database, networking and monitoring services which are certified for SAP hosting.
Philippines banks work with Bank of China to launch peso-renminbi spot market
(24 July 2018) Bank of China will ink a memorandum of understanding (MOU) with 15 local banks to ease the exchange and transactions of RMB into pesos vice versa without pegging to the US Dollar. Peso-renminbi spot market called the Philippine-RMB Community will be set up in the third quarter of the year. The Head of Bank of China, Deng Jun, said the RMB Community would open doors to trade and investment opportunities between China and Philippine. Currently, financial transactions between Filipino and Chinese businesses need to convert to US dollar rate which increases the marginal cost by one to two percent.