Policy Analysis

1. 1
Policy Analysis on Development of Special
Border Economic Zones in Thailand
by
Choen Krainara
Ph.D. Candidate
Regional and Rural Development Planning Field of Study
School of Environment, Resources and Development
Asian Institute of Technology
2 May 2014

2. 2
Policy Analysis on Development of Border Economic Zones in Thailand
This chapter will present policy analysis on development of border economic zones in Thailand. It covers both internal and external dimensions.
The paper highlights problem statements, policy interventions undertaken by the Royal Thai Government, policy evaluations and impacts. And
lastly it is recommended policy directions. The detailed policy analyses are shown in Table 1 below.
Table 1: Policy analyses towards border economic zones development in Thailand linking with neighbouring countries
Problem statements Policy intervention applied Policy evaluation and impact Recommended policy
direction
1.Internal dimension
1.1 Imbalance spatial development
1) Continuing income polarization inter-
regionally and intra-regionally
2) Strong core region through dominance
of Bangkok as megacity and weak
peripheral five border regions, which were
homes of 23.33 million population or 35.43
% of the whole country population.
3) Daily minimum wages in border
provinces were ranged from 161-181
Baht compared to Bangkok at 215 Baht.
 Promote potential BEZs in Chiangrai
and Tak provinces since 2003.
 On 6 April 2011, the Royal Thai Government
declared the policy to develop Maesod Special
Border Economic Zone in Tak province based on
integrated approach following the recommendations
of the Thai-Myanmar Border Trade Committee. This
is the first BEZs to be implemented in Thailand.
Though Thailand desires to promote
special border economic zones for quite
long time, in fact it faces sluggish
primarily due to political discontinuity
and legal issues as many government
agencies are reluctant to decentralize their
responsibilities to the proposed special
border economic zone authority.
 Implementation plan of
Maesod Border Economic
Zone and associated
investment incentives should
be initiated.
 Firm policy support to
promote BEZs should be
continued.
 Additional BEZS should be
established consisting of
- Sadao district in Songkhla
province linking with Bukit
Kayuhitam in Kedah State of
Malaysia.
- Mukdahan province linking
with Savannakhet province of
Lao PDR.
- Ranong province linking
with Koh Song province of
Myanmar.
- Aranyaprathet district in
Sakaeo province linking with
Bantaeay Meanchey province

3. 3
1.2 National security: Continuing influx
of illegal immigrant labor prompts national
security agenda.
1.3 Poverty
1) Border regions particularly in rural areas
host eight out of top ten poverty prevalence
provinces across country.
2) Significant unemployment in border
regions resulted in high out-migration rate
both from rural to urban areas particularly
Bangkok and vicinity and Eastern region
and other countries e.g. Taiwan, Singapore,
Malaysia and Israel.
1.4 Population
1) Thailand will face structural
demographic change towards mature aging
society in the year 2027 due to successful
population planning policy, in which one-
fourth of national population becomes old.
2) In 2010, the national population growth
rate was quite low at 0.77 % per year. The
population growth in Bangkok alone was
as high at 2.66 %, while the Northeastern
 Balance benefits of cross-border trade and
national security.
 Strengthen development capacity of bordering
countries placing emphasis on improvement of
quality of life of people living along border regions
of both countries. Implementation development
activities will be based on mutual trust.
Reduce proportion of people living below poverty
line to 4 % during the Tenth National Economic and
Social Development Plan (2007-2011).
 Formulated integrated strategies to address aging
phenomena in Thailand.
 Established the National Committee on
Responding to Aging Situation.
Illegally immigrant of labor from
bordering countries including drug and
human trafficking still pose persistent
problem on national security. This can be
partly addressed by employing BEZs as a
means to create international division of
labor.
 Due to continuous policy supports, the
incidence of people living below poverty
line significantly decreased from 20.98 %
in 2000 down to 8.48 % or 5.4 million
populations in 2007.
 Approximate 2.8 millions or 52.20 %
of people livings below poverty line
reside in Northeastern region.
It is good initiative in timely responding
to aging phenomena in Thailand. It is a
part of initial stage to up hold long-term
goals for moving Thailand towards
welfare state.
of Cambodia.
Promote border economic
zones to create employments
for local Thai people as well
as opening job opportunity for
immigrant labor from
bordering countries based on
international division of labor.
This can help prevent influx of
immigrant labor into interior
regions in Thailand.
 Mainstream poverty
alleviation in national
development agenda.
 It is still necessary to
progressively promote rural
and community development
in order to bring balanced
urban-rural relations.
Thailand is on right step in
preparing for dealing with
aging phenomena. It is
therefore necessary to equally
integrate productive
contributions of all age ranges
into national development.

4. 4
region faced decreasing population growth
at -1.0 %.
1.5 Labor
1) Increasing domestic labor demands.
During 2010-2014, total labor demand in
Thailand is approximately expected at 38
millions. Thailand may face serious labor
shortage in the future due to entering aging
society.
2) Currently required of unskilled labor in
particular economic sectors e.g. fishery,
construction, agriculture and household in
core regions particularly in Bangkok and
vicinity and Eastern region.
1.5 Industry: Limited industrial
development along border regions.
Border cities mostly act as distribution
function.
1.6 Logistics: High logistics costs, which
made up of approximate 16 % of GDP and
transportation cost was accounted for 7.2
% in 2005.
Encourages private sector to involve in skilled
development and skill upgrading in order to reduce
unemployment and out-migration of local people to
large cities, as well as up lifting quality of life of
local people.
Three investment zones were implemented.
Zone 1 includes Bangkok and 5 adjacent provinces.
Zone 2 comprises of 12 provinces in semi-peripheral
region. And Zone 3 consists of 58 provinces in
peripheral region with low income and less
developed infrastructure including border regions. A
wide range of privileges on reduction of import duty
on machinery, corporate income tax exemption for a
certain period was highly granted to investors in
Zone 3.
The National Logistics Development Plan (2006-
2010) aimed to decrease logistics costs down to 13 %
and to lower transportation costs at 6 % in 2010.
Shortages of labor in Thailand resulted
from decreasing population growth. Fast
economic recovery stimulated the
increasing demands of immigrant labor
from bordering countries. Therefore,
Thailand should promote towards
technology intensive industry so as to
reduce dependence on immigrant
unskilled labor from bordering countries.
Approximate 77.72 % of capital
investment was even now converged in
Zone 1 and Zone 2 due to well-developed
infrastructure, as well as having the
benefit of positive external economies.
Slow progress of logistics development is
due to discontinuity of political support.
So far, approximate 80 % of logistics
service is transported by road, which is
costly resulting in high prices of goods. In
addition, it involved up to 1,550 laws for
both land and rail transport modes, which
several of them are in conflict. Thailand
possesses strategic geopolitics to become
 Continues upgrading labor
skills based on specialization
so that labor will obtain
reasonable compensation.
 Thailand should also
enhance labor skills to
substitute migrant labor
particularly for professional
competences and unskilled
labor.
Rationally relocate specific
type of labour intensive
industries, which Thailand is
held least comparative and
competitive advantages due to
increasing labor cost to
potential border regions in
order to take advantage of
cheaper labor in bordering
countries.
Advance multimodal
transportation both within
Thailand and linking with
bordering countries in order to
promote trade, tourism and
competitiveness.

5. 5
regional logistics hub both in ASEAN
and GMS.
2.External dimension
2.1 International relations
1) Border conflicts between Thailand and
Cambodia over co-management of Prasat
Viharn temple affect cross-border trade
environment.
2) Unilateral closure of Myawaddy border
checkpoint from 23 July 2010 until
present, which causes by the Moei river
bank protection project on Thai side,
affects loss of cross-border trade value
approximately 1,800 million Baht per
month and political uncertainty in
Myanmar leads to unfavorable cross-
border trade environment.
2.2 Labor
1) Continuing influx of illegal immigrant
labor and family members from Cambodia,
Lao PDR and Myanmar at a total of 5-6
million persons due to higher wage in
Thailand creating problems on Thai
economy and society particularly on
security, public health, social and
economic aspects.
2) High turnover rate of illegal immigrant
labor from Thai border cities to interior
areas particularly Bangkok and vicinity
Resolve border conflict over the Prasat Praviharn
temple through fostering closer diplomatic ties.
Resolve border conflict over the unilateral closure of
Myawaddy border checkpoint through fostering
closer diplomatic ties.
 Two projects were implemented in 2004
consisting of (1) Establishment of illegal migrant
labor center in Tak province for sending them back
to Myanmar (2) Regulation adjustment and
permission of illegal migrant labor to work in
Maesod based on daily movement.
 The Thai cabinet also approved setting
up of One Stop Service data coordination and
registration center of illegal migrant labor in four
provinces namely Tak, Chiangrai, Ranong and
Kanchanaburi, in which Tak province was a pilot
Occasional border tension causes a
reduction of cross-border trade values
between Thailand and Cambodia at 10 %
per month. It still takes time to settle the
problem.
There existed a combination of
empirical and hidden reasons for
Myanmar to close Myawaddy border
checkpoint. The empirical reason was
Myanmar’s concern over the Moei river
bank protection project on Thai side. The
hidden reason was that Myanmar may
need to maintain domestic political
stability by controlling cross-border trade
conducted by their minority groups with
Thai traders. These motivated Myanmar
to unilaterally close Myawwady border
checkpoint.
 During 2004-2009, the annual average
of registered immigrant labor was at
881,965 persons, which were fluctuated
depending on frequency of opened
registration per year. The registered
immigrant labor will be temporality
allowed to live and work in Thailand only
for general wage labor and maid for the
duration of 1 year. In 2009, the
distribution of registered immigrant labor
constituted of 82 % from Myanmar, 8.43
Resume more effort to restore
peaceful environment along
Thai-Cambodian border
through settling of problem on
co-management of Prasat
Viharn temple.
Continues negotiating with
Myanmar for reopening the
Myawaddy border checkpoint
in order to maintain close
interdependence towards
AEC.
 Thailand is on right
direction to address illegal
immigrant labor problem and
should keep on this policy
track.
 Database of immigrant
labor from bordering countries
should be set up.
 Educational and health
services should be rendered to
immigrant labor.

6. 6
and Eastern region.
3) Lack of long-term strategy to address
illegal immigrant labor problems
2.3 Trade: Common cross-border trade
problems
1) Prevalent culture of corruption of
government officials responsible for trade
facilitation resulting in high cross-border
trade transaction costs, which also leads to
prevalence of illegally organized trade.
2) Traffic congestion at key border
checkpoints affects trade flows.
3) Incidence of cross-border drug and
human trafficking.
4) Trade discriminatory measures imposed
by Lao PDR and Myanmar caused more
difficult to Thai traders for penetrating
their markets.
5) Low trade performance from unilateral
free trade privileges due to complex
border region.
 During 2001-2009, the Royal Thai
Government has opened for registration and
extension of work permits for illegal immigrant labor
from CLM for 10 times. The principal objective was
not only to use as means to systematically manage
the illegal immigration problems but also legalize
them, as well as protecting their rights.
 In 2011, the Royal Thai Government has just
approved a comprehensive plan to address illegal
immigrant labor problem.
 Memorandum of Understandings on
labor development and cooperation have been signed
between Thailand and Cambodia (2003), Thailand
and Lao PDR (2002) and Thailand and Myanmar
(2003). Under these MOUs, it enabled Thailand to
legally import labor from CLM based on quota
arrangements.
ASEAN level
“ASEAN Hub” policy under the theme
sustaining trading and investment base particular in
Cambodia, Lao PDR, Myanmar and Vietnam
(CLMV) for moving Thailand towards global
market, which is implemented by means of
establishment of Thailand’s distribution centers,
trading firms, as well as relocating prospective
investment sectors and contract farming to
neighbouring countries.
GMS level
 Foster greater flows in order to increase
volume and values of cross-border trade, as well as
facilitating intra-GMS and extra-GMS trade
particularly on agricultural trade, investment and
tourism.
% from Lao PDR and 9.57 % from
Cambodia. There are large numbers of
immigrant labor who have not yet
registered.
 The implementation of cooperation
between Thailand and Cambodia and Lao
PDR are quite effective. The total
imported legal labors from these two
countries were at 27,447, 17,059 and
14,150 persons in 2007, 2008 and 2009,
respectively. Though huge labor
demands, in fact Thailand encounters
complex procedure in implementing this
agreement with Myanmar. Thailand has
been able to import labor for the last eight
years at a total of 1,500 persons. As a
result, influxes of immigrant labor from
CLM are persisting.
 Cross-border trade has shown on the
rising trend. During 1996-2010, the
cumulative cross-border trade values
between Thailand and neighbouring
countries were significantly amounted at
113.59 billion US$ represented at 51.15
% of cumulative trade values between
Thailand and neighbouring countries. The
cumulative share of cross-border export
from Thailand to these neighbors was as
high at 58 %. While the cumulative share
of cross-border import from bordering
countries was at 42.31 % divided into 54
% from Malaysia; 38 % from Myanmar; 6
% from Lao PDR and 1.27 % from
 A long-term plan and
strategy to turn illegal
immigrant labor challenge into
positive national economic
growth and social cohesion
should be created.
 It should designate
appropriate proportion for
allowing immigrant labor to
work in border economic
zones in Thailand.
 The policy direction is on
right track in exploiting
geopolitics of Thailand and
locational advantages of
border regions. Therefore,
Thailand should continue
promoting cross-border trade
and transit trade expansion
with bordering countries.
 Active cross-border trade
facilitation should be
rendered.
 Abolish or adjust daily
cross-border transaction
ceiling control (at 15,763

7. 7
import-export procedures either from Thai
or neighbouring countries sides resulted in
continued shortage of raw agricultural
materials in Thailand.
6) Complex and changing financial system,
relevant rules and regulations and money
transfer procedures in neighbouring
countries affect cross-border trade
environment.
7) Cross-border traders in CLM and
Thailand lack of international trade
practices.
8) Limited authorized banks in border
cities of CLM, and border trade largely
transacted on informal manner relying on
mutual trust, which affected confidence
diluting business environment and trade
expansion.
9)There is existent of regulation
announced by Bank of Thailand on daily
cross-border transaction ceiling control at
5,763 US$.
Bilateral cross-border trade problems
1.Cambodia
1.1 Frequent change of customs tariffs
rates be collected and customs practices do
not meet international standard.
1.2 Transport of goods through local
border crossing can not operate daily.
1.3 Border conflict over co-management of
Prasat Pra Viharn temple in April 2011
leads to a 10-15 % loss of cross-border
trade values between both countries.
2.Lao PDR
2.1 Inter-provincial tax charge for goods
movement at 1 %.
 Undergo cross-border trade reform towards
international standard system.
 Keenly negotiate transit trade regime with
neighbouring countries e.g. China, Lao PDR,
Myanmar and Vietnam to facilitate freer flow of
goods to nearby neighbouring countries markets in
South East Asian, South Asian, and East Asian
regions. It is obvious that there is a convergence of
Thailand’s cross-border trade policies towards GMS
and Ayeyawady-Chao Phraya-Mekong Economic
Cooperation Strategy (ACMECS).
 Promote contract farming in neighbouring
countries in order to increase supply of raw materials
for industrial and energy sectors both along border
regions and in interior regions of Thailand.
Bilateral level: Implicitly common polices
 Improve facilities and logistics system to
facilitate cross-border trade in specific border
checkpoints consisting of Aranyaprathet checkpoint
in Sakaeo province, Nongkhai checkpoint in
Nongkhai province, Mukdaharn checkpoint in
Mukdaharn province and Chonkmek checkpoint in
Ubolratchathani province, Maesod checkpoint in Tak
province and Sinkhon checkpoint in Prachuab
Kirikhan province.
 Promote closer trade institutions between
Thailand and bordering countries in the form of Joint
Trade Commission and exchange of bilateral visit of
Cambodia, respectively. As a result,
Thailand gained significant cumulative
balance of cross-border trade at 17.47
billion US$.
 The share of cross-border trade to
intra-ASEAN trade increased from 6.06
% in 1996 up to 32.49 % in 2010
reflecting the convergent noodle bowl
effects of bilateral and regional trade
agreements and regional trade facilitation
initiatives.
 The share of cross-border trade to
Thailand’s aggregate international trade
with the world rose from 1.02 % in 1996
to 6.42 % in 2010.
 Likewise, consolidated cross-border
transit trade values between Thailand and
Singapore (via Malaysia), China and
Vietnam (via Lao PDR) are also on the
rising trend, which increased from 1.60
billion US$ in 2007 to 3.00 billion US$ in
2010.During 2007-2010, Thailand gained
a total of cross-border transit trade
balance at 428.49 million US$, and the
annual growth rate of transit trade with
these three countries was as distinguished
at 25.16 %.
 In 2008, Thailand imported
agricultural produces under contract
farming amounting at 1.2 million tons
from Cambodia; 0.5 million ton from Lao
PDR; and 0.2 million ton from Myanmar,
respectively.
 Thailand extended ASEAN Integration
System of Preferences (AISP) to CLMV,
US$) in order to respond to
increasing cross-border trade
prospect.

8. 8
2.2 High customs facilitation cost e.g. O.T
charges
and high import tax lead to illegally
organized trade.
2.3 Frequent change of trade rules and
regulations on trade of wood products e.g.
up to 20 % tax charge for export.
2.4 Low trade facilitation performance
causes delay of trade of perishable goods.
2.5 Trade law does not standardize across
country.
2.6 High cost of cross-border money
transfer.
2.7 Imposes quota on selected commodities
e.g. cement, vegetable oil and steel.
3.Malaysia
3.1 Some Thai products do not meet Halal
standard.
3.2 Rapid urbanization of border cities
associated with urban environmental
problems e.g. slum, solid waste and waste
waster water, etc.
4 Myanmar
4.1 Internal political uncertainty affects
cross-border trade environment.
4.2 Unilateral closure of Myawaddy border
checkpoint since July 2011 until present
leads to a loss of 80 % of trade values per
month.
4.2 Frequent change of customs tariffs
rates be collected and customs practice do
not up to international standard.
4.3 Lack of local and regional road
infrastructure.
4.4 Long importation process (2 days).
4.5 Impose strict control on 15 imported
Ministers of Commerce.
 Hold regular consultation for both local and
regional public and private partnerships in order to
resolve problems on cross-border trade.
 Reinforce local agencies to facilitate cross-
border trade towards international standards.
 Closely coordinate with neighbouring
countries for establishing border economic zones in
order to boost the growth of co-production and cross-
border trade.
 Government agencies should provide
assistance and consultation to Thai private sectors so
that it can minimize risk in doing business in
neighbouring countries.
 Organize Thai Trade Fair in neighbouring
countries for publicizing the image of Thai products,
as well as inviting business counterparts to join.
 Thailand’s agency for providing assistance to
businesses and investors in doing business in
neighbouring countries similar to JETRO of Japan
should be in place.
 Simplify procedures and export regulations in
order to facilitate and reduce cross-border trade
transaction costs.
 Improve Value Added Tax refund system and
import tax, etc.
 Provide trainings on international trade and
cross-border trade practices to both Thai and
neighbouring countries traders.
 Closely cooperate between Royal Thai and
neighbouring countries governments in promoting
good business ethics for both cross-border traders
and investors.
 Suppress corruption of trade facilitation officials
at the border checkpoints.
which the time frame for implementing
this scheme was at eight years beginning
from 1 January 2002 until 31 December
2009. In 2005, Thailand granted
cumulative AISP to CLMV at 340, 300,
850 and 63 commodities, respectively.

9. 9
consumer goods, which are major exported
goods of Thailand to Myanmar.
4.6 Lack of decentralization of power to
local officials to issue AISP certificate.
4.7 Several imported channel of goods are
in minority group strongholds, which are
not authorized by Myanmar government.
5.Thailand
5.1.Low integration and coordination of
agencies responsible for cross-border trade
promotion and facilitation
 Legalize illegal border trade.
Different bilateral policies
1.Cambodia
1.1 Improve facilities and logistics system to
facilitate cross-border trade in Aranyaprathet district,
Sakaeo province.
1.2 Improve transport routes linking Thailand and
Cambodia in order to facilitate transportation
services, as well as reducing logistics costs to
Cambodia.
1.3 Conduct in-depth marketing research for
Cambodian market so that Thai exporters can use as
guidelines for exports.
14 Resolve border conflict over the Prasat Praviharn
temple.
2.Lao PDR
2.1 Improve facilities and logistics system to
facilitate cross-border trade at Nongkhai checkpoint
in Nongkhai province, Mukdahan checkpoint in
Mukdahan province and Chokmek checkpoint in
Ubolratchathani province
2.2 Thailand should pursue third country or
international lending agencies for rendering
infrastructure development in Lao PDR.
3.Malaysia
3.1 Strengthen knowledge on standard for trading of
Halal products.
4. Myanmar
4.1 Improve facilities and logistics system to
facilitate cross-border trade in Maesod district, Tak
province and Sinkhon checkpoint in Prachuab
Kirikhan province.
5. Thailand
5.1 Abolish or adjust daily cross-border transaction

10. 10
2.4 Industry: Limited cross-border
production network.
2.5 Logistics
1) Inefficient cross-border trade logistics
and long customs procedure at the border
checkpoints leads to high logistics costs.
For example the R3E route along North
South Economic Corridor (NSEC), 60 %
of the costs are incurred at the border
including all customs charges, and 40 %
are transportation cost.
2) Incidence of unsafe logistics provisions
as well as incurring of extra logistics fee
particularly in CLM
ceiling control (at 15,763 US$) in order to respond to
increasing cross-border trade prospect.
 Establish border economic zones along GMS
economic corridors by adopting co-production and
sister cities concepts as well as forging cooperation
on labor management with neighbouring countries.
 Establish regional production networks by
relocating some industrial, agricultural and services
investments to neighbouring countries in order to
help generate jobs, distribute income and narrow
development gaps between Thailand and
neighbouring countries in parallel with sharing of
natural resources, labor, capital, technology and
expertise. The targeted industries are agro-
processing, wood industries, sugar industry, energy,
construction, tourism, and hotel and services.
Proactive implementation of Cross-Border Transport
Agreement
 The striking border industrialization is
evident in Maesod district where 65 % of
provincial factories mainly textile,
apparel and agro-processed industries are
located (Tak Industrial Office, 2010).
Nevertheless, actual investment in the
border regions has been far behind
causing out migration of Thai labor to the
core regions worsening interregional
disparities in Thailand.
 During the last 21 years (1988-2009),
the cumulative FDI from Thailand to
Cambodia, Lao PDR, Myanmar and
Malaysia were roughly at 12.82 billion
US$. The tendency of capital investment
out-flows from Thailand to these
bordering countries appears to be
intensifying as a result of greater trade
and investment openness in the GMS and
ASEAN.
Full implementation of this agreement
was expected to complete by 2009, but in
fact it faces delay due to time consuming
for legal adjustment within member
countries. Instead, pilot border crossings
between Thailand and neighbouring
countries were initially implemented
consisting of Poipet border checkpoint in
Banteay Meanchey province of Cambodia
and Aranyaprathet border checkpoint in
Sakaeo province, Mukdahan border
Keep up developing
potential border economic
zones in Thailand in
association with strengthening
cross-border production
linkages and outward
processing in bordering
countries.
Thailand is on right aim to
facilitate speedy cross-border
logistics with least costs. It
should coordinate with
bordering countries to
minimize extra informal
logistics costs. In addition,
Thailand may encourage Thai
investors to perform joint
venture with counterparts in

11. 11
3) Unfavorable rule and regulations
4) Incompatible technology applications
between Thailand and neighbouring
countries.
2.6 Customs
1) Complex customs procedures and lot of
paper work.
2) Prevalent corruption of trade facilitation
officials.
2.7 Transport: Poor condition of road
infrastructure particularly in CLM.
2.8 Tourism: Travel by car is inconvenient
due to document requirements for
immigration formality and inadequate
infrastructure
Operate customs formality and inspection around the
clock through application of advance notice system.
 Improve transport routes linking Thailand and
CLM in order to facilitate transportation services, as
well as reducing logistics costs.
 Exploit development potentials along GMS
economic corridors.
 Support transnational connectivity under
ASEAN and Asian Highway Networks.
 Uphold Thailand as tourism gateway to Asia.
 Implemented regional tourism cooperation
schemes under GMS and ACMECS.
checkpoint in Mukdahan Province and
Savannakhet border checkpoint in
Savnnakhet Province of Lao PDR,
Maesod border checkpoint in Tak
province and Myawaddy border
checkpoint in Kayin State of Myanmar
and Maesai border checkpoint in
Chiangrai province and Tachilek border
checkpoint in Tachilek province of
Myanmar.
It aims to enhance logistics provisions, as
well as sustaining Thailand’s regional
production networks in the GMS. It also
implemented Thailand’s commitments
under GMS and action plans within
Greater Mekong Sub-region and Japan-
GMS Cooperation Framework
Rapid progress of GMS transport corridor
has resulted in flourishing cross-border
trade and people mobility. It is now
challenging to turn GMS transport
corridor into fully-fledged GMS
economic corridors. However, some
sections of road infrastructure in CLM are
in poor conditions.
The trend of cross-border people
movement seems prominent.
The aggregate people movement of all
nationals using passports and border
passes through these border checkpoints
bordering countries for
offering cross-border logistics
services.
It is a very constructive
initiative to move towards
ASEAN Economic
Community. It is crucial to
coordinate and synchronize
customs operations system
with bordering countries.
Continue connecting road
linkages with bordering
countries both under GMS
framework and further link
with South Asian and East
Asian regions in order to
facilitate trade and tourism
growths.
Cross-border tourist flows are
impressive. Networking of
tourism sites along GMS
economic corridors should be
supported. Royal Thai

12. 12
2.9 Visa: Still required visa for Thai
tourists to enter China and Myanmar
2.10 Official development assistance:
Starkly different stages of development
between Thailand and Cambodia, Lao and
Myanmar.
 Implemented pilot ACMECS single visa between
Thailand and Cambodia
 Visa exemption between Thailand and Cambodia
effective since 16 December 2010.
 Established Office of Neighboring Countries
Economic Development Cooperation Agency to
foster development cooperation with bordering
countries.
 Extended financial and technical assistance, as
well as supporting infrastructure development in
neighbouring countries based on bilateral
cooperation, GMS, ACMECS and ASEAN.
increased from 5.19 million persons in
2002 to as high at 18.22 million persons
in 2010 with the average annual growth
rate at 12.42 %. Particularly between
2009 and 2010, it surged at 37 %.
Majority of Thai tourists cross-border to
play casinos in bordering countries.
Likewise, cross-border shopping is also
on increasing trend.
ACMECS single visa is an important
instrument in facilitating greater people
mobility between Thailand and bordering
countries. It is a good illustration of
south-south development cooperation.
As an emerging donor country, during
2005-2009, Thailand has extended grant
to CLM at a total of 201.87 US$ to
develop cross-border rail links,
interprovincial roads and airports towards
sub-regional transport integration and
multimodal linkages (NEDA, 2009).
Government may need to
distract Thai tourists going to
play casinos in bordering
countries.
Keep on implementing
ACMECS single visa between
Thailand and other bordering
countries in order to ease
cross-border flows of people.
 Stretch out official
development assistance to
bordering countries based on
aid for trade concept in order
to, which will strengthen
closer international relations
towards AEC.
 Thailand should pursue
partner country or
international lending agencies
for rendering infrastructure
development in Lao PDR.
Source: Author’s field survey in 2010.
Changhlam, A. (2005). Promoting Thailand-Myanmar border trade: paper presented at the seminar on “Turning Maesod as gateway of East-West Economic Corridor” at
Central Maesod Hill Hotel, Maesod district, Tak province on 23 September 2005.
Department of Foreign Trade of Thailand. (2011).
Ministry of Tourism and Sports. (2008).

13. 13
Neighbouring Countries Economic Development Cooperation Agency. Annual Report 2009.NEDA.Bangkok.
Office of International Coordination, Office of the National Economic and Social Development Board. (2011). Customs operations 24 hours at cross-border check points.
Office of the National Economic and Social Development Board. (2009).Directions for driving integrated aging development strategies. NESDB.Bangkok.
Prince of Songkhla University. (2002).Border trades between Thailand and Malaysia.
http://www.statelessperson.com/www/?q=node/3019, retrieved on 19 April 2011.
http://www.bangkokbiznews.com/home/detail/politics/opinion/coruption/20100719/A3.html, retrieved on 21 April 2011.
http://www.backtohome.org/autopagev4/show_page.php?topic_id=597&auto_id=4&TopicPk=, retrieved on 9 May 2011.
http://www.mwgthailand.org/autopagev4/show_page.php?topic_id=93&auto_id=4&TopicPk=, retrieved on 9 May 2011.
http://learners.in.th/blog/theerarat/394867, retrieved on 9 May 2011.
http://www.oknation.net/blog/print.php?id=463566, retrieved on 19 April 2011.
http://www.oknation.net/blog/print.php?id=620312, retrieved on 10 May 2011.
http://www.tnnthailand.com/news/details.php?id=15743, retrieved on 21 May 2011

14. 14
Conclusions
The Royal Thai Government has already implemented a range of conducive policies
towards the goals of sustaining economic equity through dispersing economic
activities to key border regions, as well as considerably fostering investment out-
flows to neighbouring countries so as to create jobs, distribute income and narrow
down international development disparities. According to the preceding policy
analyses, it has found that the formulated national policies have generally favored
regional economic cooperation, as well as exploiting locational advantages through
development of border economic zones, which are evident from expanding cross-
border trade and transit trade, people mobility, capital investments and cross-border
shopping between Thailand and bordering countries. In addition, it also intended to
address such problems at national level e.g. continuing influx of immigrant labor from
bordering countries, drug and human trafficking and smuggling of goods.
However, it was quite problematic to realize policies into real practice at border city
level due to limited sectoral and spatial integration towards border economic zones
development and complex interagency coordination in which many government
agencies are reluctant to decentralize their power/responsibilities to the proposed
border economic zone authorities. It is therefore important for Thailand to strongly
determine this policy direction. Thus, integrated policies favorable towards
development of potential border economic zones should be encouraged. It is also
challenging for Thailand to move towards emerging economy by adopting more
technology and capital intensive industries in association with upgrading
comprehensive labor skills, as well as allowing some jobs to be carried out by
immigrant labor with free employment conditions at border economic zones. This can
help dealing with long-term aging phenomena in Thailand and building strong
international relations in order to foster sustainable cross-border economic
cooperation with bordering countries.
Particularly for the expansion of cross-border trade of goods, a number of contributing
factors included advancement of cross-border linkages including road, rails,
telecommunications and river ports. Official development assistances from Thailand
to develop infrastructure in bordering countries play crucial role in these progress. In
addition, bilateral and regional trade agreements particularly AFTA and ASEAN-
China Free Trade Area have up held the growth of cross-border trade coupled with
regional trade facilitation initiatives.