Since China achieved its economic rise, it has consistently been Thailand’s most important economic partner. However, in recent years, as the global economic environment has deteriorated, the relationship between Thailand and China seems to have been in trouble. Particularly after China’s ‘grey business’ has caught attention in Thai society, part of the public attitudes toward China appears to have become negative.
According to several media reports, China’s grey business has caused disruption to Thailand’s economic ecosystem. By establishing nominee companies to bypass foreign investment restrictions, grey capital has illegally penetrated the tourism and manufacturing sectors. Some of the investigated enterprises—primarily hotels and restaurants in Bangkok—used Thai nationals as legal proxies to distort market competition. Concurrently, illegal factories in provinces like Rayong employed outdated technology to mass-produce cheap goods. These operations not only dumped substandard steel into the market, undercutting local manufacturers, but also triggered an environmental pollution. This economic exploitation is compounded by large-scale money laundering and tax evasion, directly depleting Thailand’s tax revenue.
More gravely, the grey business has triggered a public security crisis and collapse of the tourism sector. Operating under the guise of legitimate businesses, these enterprises have become breeding grounds for transnational crimes,involving drug networks and underground banking for money laundering—exposed organized criminal infiltration of public safety structures, despite his eventual acquittal due to “insufficient evidence.” Public perception of deteriorating security intensified following frequent incidents targeting Chinese tourists, such as call-center scams and open drug trafficking, causing Thailand’s reputation as a “safe tourist destination” to plummet. By 2025, surveys revealed over 50% of Chinese tourists considered Thailand unsafe—a sharp 12-percentage-point increase from 2024. This directly triggered the implosion of Thailand’s largest tourist market: arrivals from China plummeted 25% year-on-year between January and April 2025, with merely 1.64 million visitors. The tourism downturn caused ripple effects on downstream industries (hotels, retail, transportation), cementing a vicious economic cycle. Thus, what began as economic erosion has exploded into a multi-dimensional crisis fracturing Thailand’s social stability.
Despite increasing media coverage that seizes upon this situation to amplify negative narratives about China—leading to deteriorating Thai public attitudes in this context—we must recognize that China itself is not the problem. Equating economic and social problems arising from Thai-Sino cooperation with China itself is far from wise. Although grey business has caused negative impacts, China and Thailand share a long history of friendly and productive collaboration, and China remains Thailand’s largest trading partner to this day. Moreover, the Chinese government has taken proactive and pragmatic steps to combat grey business it has not only established bilateral cooperation mechanisms but also actively participated in the Thai government’s recent “Sud Soi” crackdown—shutting down illegal factories and repatriating involved Chinese citizens.
Crises inevitably provoke anxiety, yet they remain intrinsically intertwined with opportunity. Shifting our perspective reveals that the grey business crisis may catalyze positive evolution in bilateral relations. Its emergence in Thailand has exposed preexisting structural vulnerabilities—latent societal gaps and regulatory loopholes within the Thai system. Intensified crackdowns can thus serve dual purposes: fortifying Thailand’s legal frameworks while nurturing healthier domestic industries. Moreover, reinforced Thai-Sino collaboration presents a strategic opening to recalibrate and deepen existing cooperation mechanisms. Joint efforts against grey businesses will generate institutional knowledge, establishing actionable blueprints for future partnerships. Crucially, this process will sharpen Thailand’s governance capacities, positioning the nation for sustained economic progress by transforming present challenges into foundational strengths.
Amidst today’s geopolitical upheavals and sluggish global economic growth, allowing addressable bilateral friction to undermine relations with the world’s second-largest economy would be strategically unsound. Instead, this moment demands we reframe crisis as opportunity—forging a more robust cooperative framework with our tested partner. Such proactive realignment will eliminate systemic risks and pave the way for sustained prosperity in Thailand-China relations. The right approach is to collaborate with China to resolve these economic and social problems rather than politicize them at the expense of Thailand and our people’s interests.
