Old Ties, New Directions

The Working Relationship Between Kansai and Thailand


Dynamic tourism and restaurant businesses have contributed greatly to the expansion of Kansai’s links to Thailand. Now, as ties between the two regions branch out into new areas, people from Kansai and Thailand are strengthening and redefining their common Asian roots.

A Shared Heritage

Kansai residents and Thai citizens are actively working together in a myriad of ways in the fields of business, government, education and cultural-social exchange, supported by historical contacts and a common Asian heritage.

Mr. Suwanchai Ritthirak, Director of the Osaka-based Tourism Authority of Thailand, believes that Buddhism is one essential part of the affinity between the Japanese and Thai people. The religion has played a vital role in many of Japan’s traditions and subsequently in the mentality of its people. Evidence of adherence to the Buddhist teachings can still be easily found in Japan, even if it is on a much smaller scale than in centuries past.

In Thailand, Buddhism shapes the perspective and course of life of roughly 95 percent of the country’s 55 million inhabitants. Much of Thai classical literature, paintings, sculptures, and early writings have been spiritually inspired by Buddhist teachings.

“[Buddhism] is a good point for understanding each other,” testifies Mr. Suwanchai. This sentiment is echoed by Mr. Songseen Susevi, Director of the Thai Trade Center in Osaka, who attributes the Kansai-Thai friendship to a shared economic and cultural history. Specifically, Mr. Songseen points out that “There have been trade relations between the two countries since the sixteenth century.”

Financial Factors

Today, Japan is by far Thailand’s most important trading partner. Kansai’s exports to Thailand account for about one-third of total exports from Japan, and roughly 25 percent of Japanese imports from Thailand arrive in Kansai. If Kansai were considered independently, it would rank internationally as the third-largest exporter to Thailand (behind Japan and the U.S.) and as the fifth-largest importer of Thai commodities (after the U.S., Japan, Singapore, and Germany).

Bangkok has established solid “Business Partner City” relations with the Osaka city government and another mutual agreement with the Osaka Chamber of Commerce and Industry to promote trade missions, information, and other types of exchange. Dr. Prapat Thepchatree, a Consul at the Royal Thai Consulate-General in Osaka, is not exaggerating when he labels the economic ties with Kansai as “very, very important.”

In fact, several years ago an Osaka delegation significantly contributed to the establishment of Japan’s chamber of commerce in Bangkok. That initial mission has now grown to include about 1,000 corporate members — making it the largest Japanese overseas Chamber of Commerce.

Kansai sports similar credentials in terms of investment. An estimated 30 percent of all Japanese investment in Thailand comes from the region. “Many small- and medium-sized industries concentrated in the Kansai area are relocating industrial plants to Thailand,” notes Prapat. “There is [an upward] trend also in the area of support industries like parts and components.”

Assisting companies interested in doing business in Thailand is the main task of the Japan-Thailand Trade Association, headquartered in Osaka. This Japanese organization provides information to its 400 corporate members (all Japanese), promotes trade and investment opportunities for companies with an interest in Thailand, and conducts seminars about the country’s developing potential.

To further stimulate economic ties, Thailand’s Board of Investment (BOI) offers various tax incentives to Japanese corporations, depending on the location of the targeted investment. Explains Prapat, “We would like to encourage investors to invest in regional areas, so we have larger incentives in those areas than if you invest in the Bangkok area.”

Again, were it a separate entity, Kansai would be the world’s second-largest foreign investor in Thailand.

On the Historical Side

It is generally acknowledged that trade between Kansai and Thailand began some 500-600 years ago. Ceramic artifacts from Thailand dating back to the early fifteenth century have been excavated in the area around the port of Sakai, in southern Osaka. While contact with most countries diminished during the Tokugawa period of isolation, some Japanese traders remained active in Thailand. Mr. Songseen notes, “During the Ayudsyu period 200-300 years ago, there were many Japanese in the Thai capital doing business.” In the year 1612 there were reportedly 1,000 Japanese traders living in Thailand. Nearly two decades after the Meiji Restoration, in 1887, official diplomatic and trade relations resumed between the two countries.

It was not until the early 1980s, however, that an official trade promotion office was set up by Thailand in Osaka. The promising economic potential of the Kansai area encouraged the Thai government to establish a permanent Osaka consulate in 1989.

As the first official consul stationed in Kansai, Dr. Prapat considers himself something of a pioneer. “When I first came here, we had nothing. No office. I still remember when we had a suite at the Royal Hotel that we used as a temporary office,” he reminisces. “But it was a very good experience. Of course, there was no [prior] experience, no one before us to tell us what we should do…we had to experiment with a lot of things — initiating contacts, initiating networks.”

Thai Business in Kansai

The hard-earned results of those responsible for fostering better relations can now be seen in Thai business activities in Kansai. Currently 20 percent of all Japanese visiting Thailand are from Kansai, and staff at the Tourism Authority in downtown Osaka are working hard to raise the figure.

Thai officials anticipate that the New Kansai International Airport will further boost the tourist trade. “The Kansai Airport will be the so-called ‘gateway’ to Japan; a lot of business and tourists will come through the airport,” said Prapat. “I think the Kansai Airport will change much of the air transportation picture in Japan.”

While the overall tourism picture does indeed look bright, some darker aspects remain. The so-called “skin trade” of Thai women forced or lured into coming to Japan, partially supported by Kansai’s numerous criminal syndicates, and Japanese “sex tours” to Thailand’s red-light districts are social issues both countries seek to resolve.

Mr. Suwanchai of the Tourism Authority vows that “we will get rid of this problem.” A special task force involving the Thai police and related security agencies has been organized and additional efforts are being made to deter Thai women from leaving their homeland by exposing them to “the suffering of Thai women who have [already] had the experience of working in Japan,” Suwanchai says.

As public officials attempt to improve these situations, representatives from other organizations are focusing on more positive developments. Thai Airways International and Bangkok Bank, which have offices in Osaka, stand out as the major Thai institutions contributing to the expansion of relations between Kansai and Thailand. There is also a possibility that another Thai bank will open a branch office in Osaka this year, but that plan has yet to be officially confirmed.

Numerous smaller Thai companies dot the Kansai business landscape as well. Among these are many trading firms, which deal in products such as frozen seafood, gems and jewelry, furniture, textile and leather goods, and auto-engine parts. Thai companies will have the chance to exhibit their products at the upcoming “Thailand Exhibition ’93” scheduled for July 27-30 at the Mydome Osaka exhibition hall. In the near future more than 10 Thai jewelry companies are expected to join Osaka’s Asia-Pacific Trade Center, scheduled for opening in 1994.

The number of Thai restaurants in Kansai is also on the rise. Those with a taste for spicy Thai cuisine probably are well acquainted with the Wang Thai restaurant in Kobe and Sawasdee restaurant in Osaka. New Thai restaurants are appearing in the area at a rate of one per month, according to Prapat. With Osaka’s reputation as a city of food lovers, Thailand’s contribution to the wide range of available cuisines will be much appreciated.

Social and Educational Ties

Cultural interaction is also a necessary ingredient in any solid relationship between countries, and Kansai is fortunate to be the home of many Thai-oriented social groups and organizations.

One such association is the 400-member Japan-Thai Club, which organizes various sports events and social activities that bring the people of Kansai and Thailand together. A group devoted to the study of Thailand’s rich literature is slated to begin its activities later this year.

Thai students are another essential link in this exchange of cultures. An estimated 200-300 Thai students are completing studies and conducting research in Kansai — at least one-third of them in Osaka alone.

Some individuals travel from Thailand to take technical training courses offered by the local governments of Kansai. On a private basis, Thailand is a regular participant in the Kansai Economic Federation’s “ASEAN Management Seminar” hosted annually by the group’s Pacific Resource Exchange Center.

With such activities firmly in place, Kansai-Thai relations seem poised to move forward. Opinions by businesspeople, students, officials, and others concur that the people of both regions have something very positive to offer each other.

As Dr. Prapat sees it, “There is the feeling that doing business in Thailand is relaxed and warm. This cannot be explained in economic terms. It’s a psychological factor that pushes many people toward Thailand.”

While Kansai may not be as warm and relaxed, the region’s projected economic growth makes it ideally suited as a partner for Thailand’s own developing prosperity. Drawing on their rich histories, the two areas can continue to cooperate successfully as they flourish.

Brian Covert