Thais and Chinese team up to localise technological solutions

He oversees a joint project with China Energy Conservation and Environmental Protection Group (CECEP) Talroad Technology to develop Bangkok as a smart city environmentally, agriculturally and in terms of education and training. The collaboration started in 2020 to tackle issues such as air pollution and solid waste treatment, as well as training talent.

While the Chinese company introduces new technologies to Thailand, the university provides expertise on how to localise them, Thiti said, adding that both parties benefited.

“For the enterprise, they will know the way to localise the technology,” he said. “As the local university, we learn about the new technology and train the new generation. If we import the technology, manpower will be needed for maintenance or development.”

Wu Yunyun, an executive adviser in Thailand for CECEP L&T Environmental Technology, said agriculture played an important role in the economies of both countries, making China a better fit for Thailand when it came to supplying technologies.

“China has already screened technology that is suitable for developing countries,” she said. “For solid waste management, the Thai population is quite similar to that in rural areas in China. There are not so many people, but their waste is not only living waste but also waste from agriculture.”

That meant incinerators were designed to tackle both daily solid waste and waste from farming, Wu said. She added that regular machines were not designed to control emissions from burning crop residue and might wear out more quickly.

Bill Chen, chairman of AI Think Tank, an organisation that helps Chinese medical technology companies enter the Thai market, agreed that localisation was important – from product design to business culture.

“The success of internationalisation lies in localisation,” he said. “For Chinese firms, localising for a foreign market is like the second time they start a business. Everything, including products, has to be adjusted.

“In China, personal protective equipment is made to be quite thick – at 65 grams per piece. But during Covid-19, Thailand requested a lighter version despite a high standard in healthcare services.

“Many Chinese PPE makers were left confused because they did not understand the local situation. During the pandemic, PPEs were not worn in air-conditioned operating theatres but in the outdoor heat of Thailand.”

Wil Chan, CEO of the TusPark WHA incubation centre in Bangkok, said Chinese companies, especially new energy vehicle makers and medical technology firms, were keen to expand their businesses to Thailand’s mature markets.

The centre was jointly set up by TusHoldings, a scientific investment group that was founded at Beijing’s Tsinghua University, and WHA, Thailand’s largest developer of industrial estates. It had helped more than 900 Chinese companies, nearly half of them developers of new energy vehicles, establish themselves in industrial estates in Thailand, she said.

“Thailand is a top new energy vehicle production hub in Asean and a lot of leading Chinese NEV companies are already here,” Chan said. “With tax discounts, a friendly business environment and competitive talent, Chinese firms will face fewer hurdles when they enter such a mature market.”

Chinese electric-car maker BYD announced in September that it would build its first Southeast Asian production plant in Thailand. It is set to start production next year, making 150,000 electric cars a year for export to Europe and countries that are members of the Association of Southeast Asian Nations.

“The US-China trade war has affected Chinese firms, especially those who target the Western and American markets, because of the high tariffs and policy restrictions,” Chan said.

“These companies could set up production plants in Thailand. With a production origin certificate from Thailand, taxes to import in Europe and the US will be significantly reduced.”

As for medical devices, she said Thailand was keen to look for cheaper alternatives from China.

“Chinese firms are able to supply machines such as eye examination equipment and non-invasive scanners for liver fibrosis at lower selling and maintenance costs than German firms,” she said, adding that eye examination technology developed by Tsinghua students had been launched in Thailand.

Naubahar Sharif, a professor of public policy at Hong Kong University of Science and Technology, said Asean markets served as the “first stop” for China to sell its technology products and services overseas.

He said the Belt and Road Initiative had been essential in allowing China to reach out to such intermediary markets, which could be used by its companies as a stepping stone on the way to the most advanced markets.

“China understands that the fight for technological prowess is central to the fight for global superpower status and hegemony,” Sharif said.

“International scientific collaborations are important to China insofar as they represent an ‘intermediary’ step towards realising China’s even larger ambitions to become a science and technology superpower by 2050.”