‘Poster child’: why more Chinese firms have Thailand in their expansion plans
With domestic profits narrowing and production capacity expanding, China’s firms are continuing to widen their overseas footprints in search of new, more lucrative markets. In this series, we examine China Inc.’s next phase of “going global” and the complex, challenging international environment its companies have chosen to enter. A subtle shift is taking place among Chinese businesses as they…
Chinese corporations are increasingly viewing Thailand as a strategic alternative to Vietnam for their overseas expansion, according to recent reports. This shift is largely driven by the desire to mitigate risks associated with trade tensions and geopolitical uncertainties. Vietnam has seen a decline in favor as Chinese firms look towards Thailand as another viable market.
Thai officials highlight Thailand's mature manufacturing base, which surpasses Vietnam's, as a key factor in its appeal. For instance, BYD, a leading electric vehicle manufacturer, has established a production facility in Thailand, whereas a similar initiative in Vietnam remains stalled due to delays. In 2025, Thailand attracted a substantial US$5.33 billion in Chinese investments, compared to Vietnam's US$2.46 billion.
This influx of capital is attributed to Thailand's strategic location and robust industrial infrastructure, which enables Chinese-funded factories to seamlessly integrate into existing supply chains extending across the Association of Southeast Asian Nations (Asean). Thailand's favorable trade relations with the United States, coupled with reciprocal trade agreements, provide a competitive edge over Vietnam, which is exposed to higher US tariffs due to stricter transshipment rules and a significant trade surplus with the US.
Despite the growing interest from Chinese firms, some analysts argue that Thailand is not merely becoming the next Vietnam. While there is recognition of potential benefits, concerns remain regarding the impact on Vietnamese domestic manufacturers and the sustainability of investments. Overall, Thailand's strategic advantages and favorable trade landscape position it as an attractive destination for Chinese companies seeking new markets.
Written by urgent.news from South China Morning Post's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
Also reported by 1 other outlet
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