December 8, 2022
BANGKOK – The restoration of bilateral relations between Thailand and Saudi Arabia would benefit four business sectors, according to analysts at news agency Bangkokbiz.
Saudi Arabia restored its relationship with Thailand this year after 32 years of coldness, and this offers an opportunity for several businesses.
Saudi Arabia’s economy weathered even the Covid-19 crisis, recording GDP growth of 6.8% in 2021, its best performance since 2012, due to the global energy demand.
Bangkokbiz analysts evaluated the potential of the relationship and zoomed in on four business sectors in Thailand that could benefit the most.
Food export and food processing
The Saudi Food and Drug Authority has permitted import of chicken from 11 Thai factories including CP, GFPT, and Thai Foods Group (TFG).
Saudi Arabia was the fifth biggest chicken-importing country at 590,000 tonnes per year — 70% from Brazil and 30% from Ukraine and Russia.
In 2021, Thailand exported 912,900 tonnes of chicken worldwide while the export value of chilled, frozen, and processed chicken was 102.529 billion baht, the Bangkokbiz analysts said.
Saudi national airline Saudia is now flying three times a week to Thailand from Riyadh and Jeddah, which is beneficial for the SET-listed Airports of Thailand.
According to statistics, Saudi tourists had generated a lot of revenue for Thailand:
2017 – 33,517 tourists; 3.51 billion baht
2018 – 28,334 tourists; 2.615 billion baht
2019 – 30,002 tourists; 2.716 billion baht
2020 – 4,125 tourists
2021 – 467 tourists
Medical tourism is also popular with Saudi tourists. There is enormous potential for Thailand as the Saudi government aims to improve healthcare for its people.
Meanwhile, the Cabinet has approved an extended 30-day visa on arrival for Saudi visitors, which will be beneficial to Bumrungrad Hospital (BH) and Bangkok Dusit Medical Services (BDMS), the analysts said.
Eastern Economic Corridor (EEC)
The EEC recently revealed that the Saudi government and private sectors are preparing to invest 300 billion baht in Thailand in fiscal year 2023 in several industries including tourism, medical care, and petrochemicals.
Capital Nomura Securities viewed the number as significantly higher than the foreign investment in the first nine months of 2022 with only 2.86 billion baht.
Investment in 2019 — before the Covid-19 pandemic — was 4.64 billion baht and 4.58 billion baht in 2020.
The company expected average foreign direct investment per year to double, which will be beneficial to AMATA Corporation and WHA Corporation.