Geography, rich resources and openness to foreign capital, labour and ideas have helped Thailand to prosper. Thailand is at the centre of mainland Southeast Asia, neighbouring Myanmar, Laos, Cambodia and Malaysia; and with easy access to global markets through the Gulf of Thailand. It is relatively large in land area—around two thirds the size of New South Wales—and has a population about three times that of Australia. It is resource rich and one of the world's top exporters of agricultural products. Thailand has the world's 24th-largest GDP (in PPP terms). Australia's official ties with Thailand stretch back to 1952, making 2012 the 60th anniversary of the bilateral relationship.
For centuries, Thailand's wealth, geostrategic position and openness to foreigners have meant that the country has attracted and welcomed traders and entrepreneurs. Throughout the 19th century and well into the 20th century, Thailand also attracted the attention of imperial powers. Although affected in various ways by colonialism and postcolonial conflicts, Thailand was never directly colonised. This achievement is central to Thailand's national story.
Today, Thailand continues to embrace foreign capital and labour, and foster trade. In 2011, trade (exports plus imports) comprised 149 per cent of GDP. The manufacturing sector in particular has been a magnet for foreign investors. Thailand is now the second-biggest economy (in PPP terms) among member states of the Association of Southeast Asian Nations (ASEAN). Thai industry is deeply integrated into regional and global value chains. Australian construction companies built parts of those chains, while Australian logistics and services companies continue to help support them. Australian manufacturers are taking advantage of Thailand's strategic location, lower costs, investment incentives, the Thailand–Australia Free Trade Agreement and the ASEAN–Australia–New Zealand Free Trade Agreement.
Government, business and people-to-people links
The broad range of Australian Government representation in Thailand reflects the richness and diversity of Australian engagement with the country. The two nations advance their shared interests in the region under a network of treaties and memorandums of understanding. The bilateral relationship is deep and resilient; when differences have arisen, we have consistently been able to manage them.
The seeds of strong economic relations were planted early in the 20th century. Australia's early connections with Thailand involved tin mining and horses (phar lap is Thai for 'lightning'). Over time, commercial transactions based on the marriage of capabilities and opportunities accumulated to a point where Thailand now hosts a critical mass of Australian companies and businesspeople.
Our growing economic ties are underpinned by a strong legal framework – especially the Thailand–Australia Free Trade Agreement. The two countries' leaders, ministers and officials collaborate closely on policy issues, as well as on trade and investment promotion, along with state governments. Since the free trade agreement's entry into force in 2005, Thailand has moved from Australia's 12th-largest to 9th-largest trading partner. In the same period, Australia has become Thailand's 9th-largest merchandise trading partner, up from 11th in 2004.
Investment and supply chains
Futuris has added a new automotive seating factory in Thailand to its global operations. The company designs and engineers its products in Australia and manufactures them in Thailand, China and the United States for supply to car manufacturers in each location. In Thailand, Futuris supplies seats to Ford and General Motors, and to Tesla in the United States.
Visy Packaging established a plastics packaging plant in Thailand to supply plastic cups to an American food company with a pineapple processing plant in Thailand. Packed in the cups, the processed pineapple is exported around the world. Initially established for a single customer, Visy's plant now services others, and will soon double its production capacity in Thailand.
Trade and investment flows from Thailand to Australia are stronger than in the opposite direction. Australian imports from Thailand accounted for $10.7 billion of $18.5 billion in two-way trade in 2011. Thai investment in Australia outstrips modest Australian investment in Thailand, even though Thai investors have only recently pursued opportunities in Australia. Australian investment in Thailand grew from $1.4 billion in 2009 to $2.1 billion in 2011, while Thai investment in Australia increased more than 10 fold from $1.3 billion to $13.4 billion over the same period. Thai business has invested in Australia's energy, infrastructure, agribusiness and tourism sectors.
The Australian–Thai Chamber of Commerce, which has over 400 members and channels of communication with the Board of Trade and Federation of Thai Industries, plays an important role in promoting business networks. Its counterpart in Australia is the Australia Thailand Business Council.
In recent years, our commercial and broader engagement with Thailand has been supported by a growing pool of Thai alumni of Australian educational institutions. The number of Thai student enrolments in Australia increased from just a few thousand in the mid-1990s to 21,630 in 2011 (including higher and vocational education, English language courses and schools). However, the number of Australians studying at Thailand's well-regarded universities is low. For that reason, many more Thais know and are confident in dealing with Australia than vice versa. Initiatives such as Australian Education International's Visiting Researcher Program promote connections that lead to cooperation between Thai and Australian institutions, including in cutting-edge fields such as renewable energy and nanotechnology.
Two-way contacts between Australia and Thailand continue to grow. The 2011 Census counted more than 45,000 Thailand-born people in Australia. Thailand is one of the most popular destinations for Australian tourists. In 2011, 856,483 Australians visited Thailand, and 85,400 Thais visited Australia. We now also have a working holiday maker program with Thailand.
The Australian Government supports a range of programs designed to build broader and deeper bilateral ties with Thailand, such as the special visitors, overseas media visitors, and cultural relations programs run by the Department of Foreign Affairs and Trade. Artistic and cultural exchanges are growing independently on the back of increased ties in education. The Australia–Thailand Institute, established in 2005, has increased mutual awareness and understanding of cultures, values and traditions; and promoted institutional and people-to-people links. Other organisations, such as Asialink, the Asia Society and Musica Viva, are also active in this field.
The Australian Studies Centre at Thammasat University supports teaching and research about Australia and offers information services on Australia for the Thai community. In Australia, the National Thai Studies Centre at the Australian National University promotes the study of, and public awareness of, Thailand.
Australia is one of Thailand's leading partners in defence, law enforcement, border protection and aviation security. There has been substantial investment and cooperation in these areas, especially over the past decade.
Australia's and Thailand's security concerns began to overlap during World War II, when over 13,000 Australian prisoners-of-war toiled on the Thai–Burma railway; 2,800 of them died, along with many more Thais. During the Cold War, Australia and Thailand shared security perspectives. For example, Australian and Thai troops served together in the Korean and Vietnam conflicts. Australian and Thai troops also worked side-by-side on UN peacekeeping, stabilisation and reconstruction duties in Cambodia and East Timor. We still work together through diplomacy, defence cooperation and other means to promote a peaceful and stable region.
Australia and Thailand share a vision for the region. Each values the benefits that can flow from strong bilateral relations with countries of the region and outside it. Like Australia, Thailand has deep ties with Japan, expanding ties with China, and strong security and economic ties with the United States. Both Australia and Thailand value the contribution that global and regional architecture can make to security and prosperity.
Both countries will continue to pursue joint interests and objectives through the ASEAN Regional Forum, the ASEAN–Australia–New Zealand Free Trade Agreement and the East Asia Summit. Thailand is intimately involved in ASEAN's efforts to promote economic development, social integration and stability in the region. Thailand's major trade and investment partners are other ASEAN members.
By 2025, all Thai tariffs and quotas on Australian goods will have been eliminated. Trade policy success will be measured by the extent to which further bilateral or regional economic integration can open the Thai and Australian markets to more of each other's investors and service providers.
As a major economy in the ASEAN Economic Community, which is to be established by 2015, Thailand's strategic location will offer Australian manufacturers, including those in the automotive sector, competitive opportunities to integrate into regional and global supply chains. For other Australian companies, such as those in construction, engineering, rail and logistics, Thailand will be a platform for participating in the deeper transport integration of Southeast, East, and South and Central Asia. Thailand's reliance on innovation and productivity to escape the 'middle-income trap' provides an opening for Australia to be a source of, and partner in technology, training, and research and development. By 2025, energy cooperation could be another pillar in the relationship. Australian and Thai companies develop, export and import large amounts of energy. They invest heavily in exploration, production and energy-related services. Nascent bilateral investment and collaboration in recent years foreshadows much deeper links in the future. If Thailand decides to open up its minerals sector, as it is being encouraged to do by Australia and others, significant opportunities will emerge for our world-class companies engaged in sustainable and environmentally responsible mining and related services.
Food security, buttressed by trade and investment, could become yet another pillar. Australia and Thailand are major food exporters and work together in the Cairns Group for agricultural trade liberalisation. Both countries have well-developed agriculture industries and strong food technology and services industries. In regional and global markets, we complement each other, rather than compete.
Continued sustained effort in security cooperation should lead to greater connectivity between Australian and Thai agencies, and faster and fuller exchanges of information on security challenges.
Stronger people-to-people links, underpinned by two-way flows of students, researchers, investors and artists, should see Australians and Thais looking more to each other for collaboration, inspiration and recognition.