But Thailand needs to improve competitiveness and productivity to attract FDI, said the bank’s economic intelligence unit.
The survey is based on responses from 170 Chinese investors who are involved with FDI-related businesses.
Some 61% of respondents are Chinese investors investing and doing business in Thailand, said Manop Sangiambut, chief financial officer and first executive vice-president.
Meanwhile, 66% of 170 respondents said they plan to increase investment in Thailand over the next two years, while 22% expect to maintain the existing investment portion and 12% said they plan to reduce investment locally.
Local market expansion is the primary reason attracting Chinese FDI inflow into Thailand, representing 56% of motive variables, followed by Asean market expansion at 40% and the use of local raw materials at 37%.
Based on this survey, SCB expects Chinese FDI inflows to increase significantly in the post-COVID-19 period.
Retained demand of Chinese investment during the pandemic will also lend support to Chinese FDI inflow moving into Southeast Asia’s second largest economy in the next few years.
Besides existing investment from Chinese manufacturing businesses in Thailand, new industries, such as technology, services and food and restaurant business have also expressed interest in expanding into Thailand, said Mr Manop.
Some Chinese investors are also looking for local business partners through joint venture or merger and acquisition deals in Thailand, he said.
SCB, the country’s fourth largest commercial lender by total assets, has continued to increase its loan portfolio of Chinese businesses investing in Thailand.
The bank currently focuses mainly on large listed companies on China’s bourses and state-owned enterprises.
Yunyong Thaicharoen, chief economist at SCB Economic Intelligence Center, said greater clarity of Chinese FDI inflows will transpire in the second half as investors are assessing the government’s management of the new COVID-19 outbreak.