Alibaba gearing up to invest in Thailand industrial development region, raises monopoly concerns

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An Alibaba competitor brought up issues of pricing competition that would hurt SMEs

 

Thailand Prime Minister Prayut Chan-o-cha signed a Memorandum of Understanding with Alibaba Executive Chairman Jack Ma last week to have the Chinese e-commerce giant invest in the country’s Eastern Economic Corridor (EEC) development plan.

According to the Bangkok Post, the decision prompted concerns from the Thailand business community that it would help turn Alibaba into a monopoly.

Alibaba is planning to invest US$352.4 million in built a digital hub.

The EEC development project is the most ambitious of the junta’s economic development plans and is hoping to bring in US$45 billion of investment to Thailand’s eastern industrial region. In this case, it is in reference to the provinces of Bangkok, Chachoengsao, Chon Buri and Rayong. The project will be focussed on the technology sector.

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The person leading the charge against Alibaba is Pawoot Pongvitayapanu, the Founder of tarad.com, an e-commerce platform that would come into direct competition with Alibaba.

He expressed concerns about Chinese goods flooding the market and making it difficult for Thai businesses to compete because they cannot compete with the lower production costs companies like Alibaba.

The concerns prompted a response from the government spokesman Sansern Kaewkamnerd who said citizens need to focus on the economic upsides and that the government carefully considers the impact of foreign companies on the EEC.

The reason people Alibaba’s involvement created apprehension is because the EEC is designed to facilitate investment by decreasing taxes, lowering visa hurdles and allowing companies to rent land for 99 years.

The government said it will work to make sure SMEs are not decimated by foreign investment, but said it will continue to embrace international companies investing in the EEC development project.

For his part, Pawoot said his comments were not directed at Alibaba itself but rather the larger conversation about maintaining a fair import/export relationship with China.

Also Read: Creating Asia’s own Silicon Valley: An ecosystem of curated relationships

 

Southeast Asia is now a crucial market for Chinese tech firms who are looking to the region to expand their empires.

Copyright: chalabala / 123RF Stock Photo

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Source: e27