Abstract

The processed food business is a highly important sector for Thailand that increasingly generates major revenue for the country. As Thailand is located in the heart of Indochina and a major hub linking between ASEAN countries and China through, Yunnan, a province in the south-west of China, with strong fundamental linkage on economic and culture, as well as the facts that Thailand enjoys a healthy relationship with China for a long time in terms of economics, politics and culture, there are a number of potentials to expand business opportunities and promote the expansion of trade in processed food products between Thailand and China, under the ACFTA agreements implemented over the past decade. In 2012, Thailand’s processed food sector generated global revenue of approximately THB 1 trillion, or about 10% of GDP, while China, with a population of about 1.3 billion, offers a huge processed food market.

This research project is a qualitative one with the data collection from secondary sources as well as from focus group interviews of business operators and government officials in Yunnan and Thailand. With increases in population and income, as well as changes in lifestyles, the demand for the food, especially Thai processed foods with good reputations for safety, taste, and quality, is rising exponentially. This paper identifies major areas of growth opportunities between China and Thailand for trade in processed food, including: product standards and strategy; promoting competition on brand and quality; road show and trade exhibitions; centralized logistics and distribution development; market penetration through partnerships with distribution channels; and trade-dispute services and compliance with relevant regulations. Recommendations for future research are: the study of the Chinese processed food market as a whole, and other selected provinces, and the study on the list of Thai processed food products with strong potential in the Chinese market.