Mon, Apr 29, 2019 - Page 7 News List

Thailand’s richest family gets richer helping China

The Chearavanont family’s Charoen Pokphand Group is the main conduit for Chinese investment in the ‘Eastern Economic Corridor’ through three provinces, a key program of the ruling military junta

By Blake Schmidt and Natnicha Chuwiruch  /  Bloomberg

Illustration: Yusha

Chia Ek Chor (謝易初) fled his typhoon-ravaged village in southern China and started a new life in Thailand selling vegetable seeds with his brother in 1921. Almost a century later, with the largest family fortune in the country, his descendants are becoming Chinese President Xi Jinping’s (習近平) key economic allies.

Chia’s son, Dhanin Chearavanont, is senior chairman of Charoen Pokphand Group Co, a vast conglomerate that is the world’s biggest producer of animal feed, shrimp as well as a top telecom firm in Thailand.

It is at the center of an ambitious plan to turn Thailand’s eastern seaboard into a tech hub with bullet trains, 5G networks and smart car factories.

The so-called Eastern Economic Corridor (EEC) is the flagship program of Thailand’s military regime, a bid to leverage Japanese investment and Chinese tech giants like Alibaba Group Holding and Huawei Technologies Co to revive an economy that grew 4.1 percent last year, the slowest rate in emerging Southeast Asia.

However, a messy March 24 general election means that projects could come under greater scrutiny as critics accuse authorities of dispossessing local farmers to make way for Chinese investors.

“Locals would be downgraded to second-class citizens,” said Somnuck Jongmeewasin, a lecturer at Silpakorn University’s International College, who studies the EEC. “A colonial era is emerging in the EEC area through Thai-Chinese investment policies.”

Xi’s signature Belt and Road Initiative has come under fire in countries, including Sri Lanka and Malaysia, for infrastructure projects that were seen as providing little benefit for the host nations, while saddling them with heavy debts.

However, the military junta that seized power in Thailand in a 2014 coup has embraced the alliance, promising a 1.7 trillion baht (US$53 billion) investment to develop three coastal provinces close to the capital — Chachoengsao, Chonburi and Rayong.

They are now among the fastest growing regions in the country, with manufacturing eclipsing tourism from resort towns like Pattaya, famous for its sun-and sleaze-seeking crowds.

Roads that ran through fields of rice, coconuts and mangoes are packed with cargo trucks and farms are giving way to industry — chemical plants, a Toyota factory. Oil rigs sit offshore Thailand’s biggest port, Laem Chabang. Makeshift stands beneath roadside trees sell palm sugar, sticky coconut rice and sometimes skewers of roasted field mice to the growing numbers of inhabitants.

CP Group is a main conduit for the Chinese investment in the region.

A CP-led consortium, including China Railway Construction Corp, was the lowest bidder for a 225 billion baht contract to build a 200km rail network linking Bangkok’s two international airports and another near Pattaya with an industrial zone on the eastern coast. The group is also bidding on an airport zone.

However, a change of government could lead to greater scrutiny of EEC deals. With no outright majority in last month’s election, seven parties opposed to the military are trying to form a coalition government.

Meanwhile, Thai Prime Minister Prayuth Chan-Ocha’s military backed party has explored a coalition with the Democrats, which was headed by royalist former prime minister Abhisit Vejjajiva until he stepped down last month after poor electoral showing. His father was a CP Foods director for more than 15 years.

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