The Prime Minister of Bangladesh, Sheikh Hasina recently concluded a six-day visit to Thailand. Can Thailand be an important partner for Bangladesh in maritime economy, climate justice, ecotourism and a gateway into the ASEAN bloc?
Prime Minister Sheikh Hasina has just concluded a six day state visit to Thailand, which is both bilateral and multilateral in nature. Prime Minister Sheikh Hasina’s visit to Thailand has immense geopolitical significance for Bangladesh as Thailand can become the gateway for Bangladesh to integrate with ASEAN. The Bangladeshi Foreign Minister Dr. Hasan Mahmud has already expressed his desire in February this year to become a sectoral dialogue partner of ASEAN preferably by the next Asean summit, to be held in Vientiane, Laos, in October.
The Bangaldeshi Premier’s visit to Thailand is part of a broader objective of fostering strong relationships with neighboring countries as part of her ‘Neighbourhood‘ policy.
The Bangladesh delegation led by the Premier have inked five bilateral documents (an agreement, three memorandums of understanding (MoUs) and a Letter of Intent (LOI) on visa exemption, cooperation on energy, tourism and customs matters, and negotiation of a free trade agreement (FTA) between the two countries.
Visa Exemption
Visa exemption for the official passport holders
Energy
MoU on Energy Cooperation
Customs
Cooperation and mutual assistance in customs matters
Tourism
Cooperation in the field of Tourism
Free Trade Agreement
LOI to commence negotiations on a free trade agreement (FTA) by the year 2024
Two MoUs on energy cooperation and tourism cooperation was signed by Foreign Minister Hasan Mahmud from the Bangladesh side, while agreement on visa exemption by Home Minister Asaduzzaman Khan, LOI by State Minister for Commerce Ahasanul Islam Titu and and MoU on by National Board of Revenue (NBR) Chairman Abu Hena Md Rahmatul Muneem.
The signed documents have opened up possibilities of collaboration on increasing bilateral trade, research cooperation and technical assistance in the area of the blue economy, and increased people to people relations.
11 Countries
Member of the bloc
6.5% of Global GDP (PPP)
Contributed by ASEAN
Thailand 2nd Largest Economy
Achieved upper-middle income status in 2011
USD 500 Billion
Thailand's GDP (PPP)
Thailand is one of the five founding members of The Association of Southeast Asian Nations (ASEAN) which today consists of 11 nations and represents a population of over 600 million. The bloc’s GDP in terms of Purchasing Power Parity is close to USD 10.2 Trillion which is 6.5% of Global GDP(PPP) which represents one of the largest economies of the world. Thailand is currently the 2nd biggest Economy in the ASEAN bloc with a GDP of more than USD 500 billion and per capita GDP of USD 7,800. The country achieved upper-middle income status in 2011.
Sheikh Hasina’s visit has increased the possibilities to position Bangladesh as a trade hub and bridge of business between the ASEAN, South Asian and South East Asian countries. On the areas of cooperation and development we have identified geopolitics, blue economy specially Coastal and Marine tourism, marine fishing, removing trade barriers for Bangladeshi goods and services into the ASEAN market as the most important sectors.
The Geopolitical significance of neighborhood first policy of Bangladesh
Since securing power for the fourth straight term it is evident that Bangladesh under the leadership of PM Hasina has put renewed focus on the regional countries to reshape bilateral and multilateral relationships with Asian nations. The visit of the Emir of Qatar and PM Hasina’s visit to Thailand marks the importance Bangladesh is putting on regional economies for the development of the nation.
Asia is home to most of the fastest growing nations of the world and 60% of the world population. However trade statistics show that Bangladesh’s export is heavily reliant on North America and Europe. With most of the Asian nations experiencing GDP growth in terms of Purchasing power parity, and a slowdown in the western nations due to war and geopolitical uncertainties it is imperative that Bangladesh puts stress on the need to diversify its export market into non-traditional Asian markets.
Both the Premiers discussed the regional cooperation mechanisms under the BIMSTEC framework. Thailand, as the current chair and host of the Summit to be held later this year, will hand over the chairmanship to Bangladesh. The Bangladesh premier has sought Thailand’s support in achieving a sustainable solution to the Rohingya crisis. The PM has stressed that the Rohingya crisis originated in Myanmar, an ASEAN bloc nation, and that the solution must be found in Myanmar.
Strategic Importance of Strait of Malacca
60% of Global Maritime Traffic
Passes through the Strait of Malacca
Vital Energy Shipments
From the Middle East to Japan, India and other South Asian and Southeast Asian Nations
Geopolitics
Hotbed of Rivalry between China and the US-India-Japan Nexus
The Strait of Malacca is the shortest transportation route between the Far East and Indian Ocean. Approximately 60% of the world’s maritime shipping passes through the Strait of Malacca. It acts as a transit point for most of the shipping including vital energy shipments from the Middle East to Japanese, Indian and other South Asian and South-East Asian ports. The region has also become a hotbed of rivalry between China and the US-INDIA-JAPAN nexus.
Regarding maritime connectivity, PM Hasina said the two sides discussed the direct shipping line between Ranong Port and Chattogram Port. Bangladesh is following with great interest Thailand’s flagship “Landbridge project.“
PM Hasina’s visit to Thailand which is situated close to the strait signals that Bangladesh is engaging in active diplomacy with Thailand and other ASEAN states to protect its trade interest with the Eastern and Pacific countries and thus safeguarding the economic future of the nation. While addressing the 80th Session of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP), the Premier has reiterated her call to end all forms of war. While showing support for the UN secretary general’s “New Agenda for Peace”, She said –
Economy first: Free Trade Agreement between Thailand and Bangladesh
As Bangladesh looks to sign a Free Trade Agreement (FTA) with Thailand, its first such move with an ASEAN member state, Thailand looks to Bangladesh as an important strategic partner in South Asia, as stated by the Deputy Prime Minister and Commerce Minister Phumtham Wechayachai. Both the nations have signed a Letter of Intent (LoI) to commence the Thai-Bangladesh FTA negotiations by the end of this year. Bangladesh can become an attractive destination for Thai investment as the nation wants to increase its footprint in South Asia through trade and investment and connect to the markets in the Middle East and Africa.
US$ 1.09 Billion Imported to Bangladesh
Oil, cement, plastic pellets, man-made fibers and fabrics being major imports
At present the Trade balance is significantly in favor of Thailand. In 2023, the total value of trade between the two countries reached USD 1.18 billion out of which Bangladesh imported goods worth USD 1.09 billion. Bangladesh’s imports from Thailand include oil, cement, plastic pellets, man-made fibers and fabrics. In order to increase trade between Thailand and Bangladesh there is a need to achieve balance between the two countries in which regard the FTA can be instrumental. A successful implementation of FTA with Thailand will gradually clear the path for similar trade agreements with other ASEAN nations. Bangladesh currently faces enormous trade deficits with most of the ASEAN nations. If trade balance can be achieved it will reduce Bangladesh’s dependence on western countries for its exports of goods and services.
Prospect of Collaboration on Blue Economy: Blue Tourism
Thailand has been carrying out a number of significant Blue Economy projects. A new tourism development strategy called “blue ecotourism”, also referred to as “sustainable tourism”, was unveiled at APEC Thailand 2022. It highlights agrotourism, culinary agrotourism, community and rural-based ecotourism, and nature-based tourism. The Thai Ministry of Tourism and Sports estimates that ecotourism makes up about 25% of Thailand’s total tourism industry revenue. In addition, the marine tourism sector has grown quickly in an effort to revive the post-pandemic national tourism development agenda. The Green Fins Project, low-carbon hotel operations, a low-carbon destination project in Koh Mak, and the BIOFIN Plan are a few well-known Blue Ecotourism initiatives.
25% of the Workforce
Employed by Blue Economy
25% of the Tourism Industry Revenue
Comes from Ecotourism
Thailand has a robust blue economy which contributes to around 30% of GDP and employs around 25% workforce in traditional industries such as marine fishing and Coastal & Marine tourism (CMT). The geographical and strategic location of Bangladesh in the Bay of Bengal has opened opportunities for the development of CMT, an area which still hasn’t been explored much. The entire coastline which is 710 km long runs parallel to the bay of Bengal. Despite this historic achievement, maritime tourism or blue tourism has largely remained untapped. The sector mainly depends on local tourists. The share of total maritime and coastal tourism in the maritime industry will likely reach 26% by 2030 making it the largest contributor.
Sabrang Tourism Park in Cox's Bazar
1027 Acres
Sonadia Ecotourism Park
8967 Acres
Naf Tourism Park
271 Acres
US $ 2 Billion
Revenue expectation of BEZA
200,000 New Jobs
Employment Expectation of BEZA
The Sheikh Hasina administration has taken some notable steps to promote tourism in this sector namely the “Sabrang Tourism Park” in Cox’s Bazar by the BEZA under the PMO, which is an ongoing development project with an area of 1027 acres, the first of its kind tourism-based special economic zone and 1st exclusive tourism zone in Bangladesh. Moreover the masterplan of Sonadia Ecotourism Park(8967 acres) and Naf Tourism Park(271 acres) to attract international tourists. The MOU signed between Thailand and Bangladesh on cooperation in the field of tourism may open Thai investment and technical support in developing these projects. Beza aims to generate $2billion for the economy and create two hundred thousand new jobs from these parks, which they feel will also encourage development across the country. Beza is set to offer 100% tax exemption for the first 10 years, followed by 70% and 30% tax exemptions in the 11th and 12th year, respectively.
Deep Sea Fishing: A potential step towards ensuring food security
More than 100 NM
Widest Shallow Shelf Region
65 NM
Average Global Shallow Shelf Region
Bangladesh has secured exclusive rights to 118,813 sq. Km of territorial sea and exclusive economic zone in the Bay of Bengal. With the Bay of Bengal, Bangladesh has the widest shallow shelf region extending more than 100 nautical miles, which is 3-4 times wider than those of Myanmar, the eastern coast of India, and the global average of 65 km. This provides Bangladesh a greater shallow bottom fishing area per unit length of coastline than its neighbors. But currently no fishing is currently done on the deep sea due to lack of vessel capacity and appropriate fishing technologies. Almost all of Bangladesh’s marine fishing is conducted on the shallow waters.
11% of Total Population
Employed by the fishing sector
2.41% of Total GDP in 2023
Contribution of the fishing sector
1.21% of Total Export Earnings in 2023
Contribution of the fishing sector
4.78 Million MT Fish
Contribution of the fishing sector in FY 2022-23
At present more than sixteen million people or about 11% of the total population depends on this sector for their livelihood. The fisheries sector has contributed to 2.41 percent of the total GDP in 2023 and about a quarter of the Agricultural GDP. According to the Economic survey in 2023, the fisheries sector contributed to 1.21 percent of total export earnings. The country produced 4.78 million metric ton of fish in the fiscal year 2022-2023. Thailand’s investment and technological assistance in Digital Marine Fisheries Resource Mapping for the marine waters to ensure sustainable and efficient harvesting of marine resources and preparing Bangladesh for deep sea fishing has the potential to increase Bangladesh’s fish production manifold thus ensuring food security and generating foreign revenue.
Research and Collaboration on Blue Technologies
There are enormous prospects and potentials for collaboration with Thailand in the area of blue technologies. Marine biotechnology is a relatively young subset of biotechnology. Currently there are some public and private institutions in Bangladesh conducting research on conventional land-based biotechnology with noteworthy success namely the entire genome sequencing of Jute, high-yielding varieties of rice, drought resistant crops, bio fertilizers etc. However Bangladesh lags behind its peers in the development of skilled manpower in the marine sector which can be fulfilled through training, higher studies, technological and academic cooperation in which case Thailand can be an important partner. Both nations can collaborate through information sharing and database management information sharing for sustainable technology generation.
Private Sector Engagement between Thailand and Bangladesh
The premier has urged her Thai counterpart to explore investment opportunities in Bangladesh’s healthcare sector alongside special economic zones and hi-tech parks. PM Hasina has offered an exclusive economic zone for Thailand and has assured her counterpart of taking necessary measures to facilitate investment and ensure ease of doing business. The premiers of both countries have discussed the possibility of cooperation on training and capacity building for Bangladeshi medical personnel.
Climate Change: The next frontier for Thai-Bangla cooperation
According to The Climate Risk Index 2021, Bangladesh and Thailand ranks 7th and 8th most vulnerable to adverse effects of climate change. Both Thailand and Bangladesh are extremely vulnerable to storms, salinity, seasonal floods and waterlogging. Climate change adversely affects ocean dynamics and greatly influences the behavior and life strategy of marine species. Both nations can increase cooperation to learn from each other’s community and house-hold climate adaptation practices, active joint research participation, youth engagement and mutually develop and collaborate on projects to reduce the adverse effects of climate change.
Conclusion
Prime Minister Sheikh Hasina’s visit to Thailand marks a significant milestone in Bangladesh’s bilateral and diplomatic endeavors to secure its economy and foster cooperation on issues of mutual benefit. Through the signing of several bilateral documents and agreements, both countries have reaffirmed their commitment to enhancing trade, investment, and collaboration across various sectors.
Bangladesh’s strategic focus on strengthening ties with neighboring countries, particularly within the ASEAN region, underscores its determination to diversify trade relationships and secure its economic future. By leveraging Thailand’s position as a gateway to ASEAN, Bangladesh aims to tap into the vast opportunities offered by one of the world’s largest economic blocs.
Moreover, the visit highlights Bangladesh’s proactive approach to addressing shared challenges such as climate change, where collaboration between the two nations can yield tangible benefits. By learning from each other’s experiences and jointly developing solutions, Bangladesh and Thailand can contribute to mitigating the adverse effects of climate change and building resilience in vulnerable communities.
Overall, Prime Minister Sheikh Hasina’s visit underscores Bangladesh’s commitment to proactive diplomacy and regional engagement aimed at securing its economic interests and fostering cooperation on issues of mutual benefit. As both countries continue to strengthen their partnership, the prospects for greater prosperity and sustainable development in the region are indeed promising.
About the Author
Tanmoy Dhar is an Economics graduate from the University of Dhaka. He has served an associate at CounterFoto- A Center for Visual Arts.
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[…] recent trip to Thailand a Letter of Intent (LOI) was signed to commence negotiations on a free trade agreement by the end of year 2024. Bangladesh currently has a transit and transhipment agreement in place […]