- Thailand is an important trading partner of Malaysia, both in terms of market for Malaysian products as well as a destination for Malaysian investments. Thailand ranks as Malaysiaโ?™s sixth largest trading partner, fifth largest export market and sixth largest source of imports. In terms of approved investment, Malaysia is the sixth largest foreign investor in Thailand.
- The two-way trade between Malaysia and Thailand is expanding at satisfactory level. In 2004 total trade recorded was US$11.8 billion , an increase of 42 per cent from US$8.3 billion in 2003. In the first five months of 2005, total trade was US$ 5.6 billion. Within ASEAN , Thailand is Malaysiaโ?™s second largest trading partner, after Singapore.
- Malaysia ‘s exports to Thailand expanded by 70 per cent over the period of five years from 2000-2004. In 2004, exports grew by 33 per cent to US$6.1billion, from US$4.6 billion in the previous year. Major export items include semi-conductor devices and integrated circuits, petroleum oils and crude oils, and parts and accessories for office machines and automated data processing machines.
- Similarly, Malaysiaโ?™s imports from Thailand also showed positive trend, expanding by 82 per cent over a five- year period. Malaysiaโ?™s imports recorded an increase of 53 per cent, from US$3.8 billion in 2003 to US$5.8 billion in 2004. Major import items include semi-conductors devices and integrated circuits, parts and accessories for office machines, and natural rubber and gums.
- Analysis of the trade flows indicate that 45 percent of trade comprises electrical and electronic products, reflecting the exchanges between MNCs located in both countries. Both countries can work together towards promoting products of SMEs into each others market.
- The investment cross-flows between both countries are also expanding.
- Based on Thai Board of Investment (BOI) statistics, approved cumulative Malaysian investments in Thailand from 1999 to 2004 amounted to US$1.38 billion. In 2004, Malaysian investments totaled US$298.43 million. Malaysia is the 6th largest investor country in Thailand after Japan, US, Singapore, Netherlands and Hong Kong. Malaysian investments in Thailand are diversified and cover both manufacturing (particularly electrical and electronic products) and services sectors.
- Based on the records of Malaysian Industrial Development Authority (MIDA), for the period of 1999 to 2004, there were 20 manufacturing projects approved with equity participation of US$103.5 million from Thailand. Thai investments in Malaysia in 2004 totaled US$9.7 million. Thai investments were in the manufacturing sector, in particular electrical and electronics and auto sector.
- Among Malaysian companies having operations in Thailand are Petronas, Sime Darby, Ingress, Kurnia Insurance, MBf, RHB Bank and Bernas.
- Malaysian companies are expanding their investments into Thailand due to:
– liberalisation of markets under AFTA; – development of selected industries in Thailand, e.g. the expansion of the automotive industry; and – relocation/rationalisation of production base.
A major Thai investor in Malaysia is the Thai Bitumen Co. Ltd. which invested in the development of a large plant in Kemaman, Terengganu to produce bitumen, heavy and light vacuum gas oil and kerosene.
