With reports of Indonesian fisherman seizures and Filipino international arbitration suits, China’s relationship in Southeast Asia appears to be hitting a rough patch. Such a declaration would naturally premature, as China’s influence in Southeast Asia has greatly increased, as it remains the largest trading partner of most of the region’s nations. More than having a vibrant trade relationship, China has also partnered with a variety of Southeast Asian countries through investment and development, and continues to do so, despite the rising tensions in the South China Sea.

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Former Thai Prime Minister Yingluck Shinawatra

In recent years, Thailand has sought closer relations with China. Thailand is a traditional US ally and is considered a “major non-NATO ally”. However, relations between the US and Thailand have soured after a 2014 bloodless coup d’état saw the overthrow of the popularly elected government of Yingluck Shinawatra. Yingluck Shinawatra and her older brother, former Thai Prime Minister Thaksin Shinawatra, were accused of corruption, swelling influence of the Shinawatra family, and for insults against Thailand’s revered king, Bhumibol Adulyadej. Thaksin Shinawatra was also overthrown in a military coup in 2006.

The US has supported the popularly elected Shinawatra ministries. Former US ambassador to Thailand, Kristie Kenney, criticized the coup advocating a “return to democracy” in Thailand which earned a harsh response from Thai royalists. There is a close relationship between the palace and the military in Thailand, and now with a military government in charge in Bangkok, the US relationship with its oldest Southeast Asian ally has soured.

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Former US Ambassador to Thailand Kristie Kenney

This is also apparent as the military government in Thailand has also sought closer relations with neighboring China. In 2015, China and Thailand held their first bilateral military exercises and pursued closer military and economic relations. Such warming relations between China and a Thai government that was coolly received by the US government are alarming for American observers. Taken in the context, closer Chinese-Thai relations could be seen in a similar vein as the warming US-Vietnam and US-Philippines relations taken as a way to counter China.

Indeed, closer relations between China and Thailand can be perceived as dubious for US interests. However, China’s pre-existing economic and investment relationship with Thailand hints that the growing relationship is nothing new. In a time where relations between China and Southeast Asia have soured due to tensions in the South China Sea, non-parties like Thailand and Indonesia have found themselves in an advantageous situation.

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Chinese President Xi Jinping with Thai Prime Minister Prayut Chan-o-cha

While the parties of the South China Sea conflict, especially Vietnam and the Philippines, have sought closer relations with the US in order to counteract China in the region, nonparties can take advantage of the situation by playing both sides. Observers, particularly American observers, should not be so quick to judge warming China-Thailand relations as an affront against the US, as the US ambassador to Thailand, Glyn Davies, claims stronger Chinese-Thai relations is “good for Thailand” and affirms that the “US has not lost Thailand to China” and Thailand still expresses interest in joining the Trans-Pacific Partnership.

Thailand, as Southeast Asia’s second largest economy, provides a great opportunity for Chinese business and investment. On the other hand, Thailand could benefit greatly from Chinese infrastructural investment and business development. Also, it is impossible to ignore existing troubles that exist between China and Thailand, particularly China’s control of the Mekong River upstream.

Close relations between China and Thailand possess great opportunities for both countries, and while observers fear that close relations between the two will be detrimental for the US, it is also important to see some of the maritime reasons for Chinese involvement in Thailand. In an earlier article, I discussed the difficulties of China’s reliance of the Malacca Strait for its international trade and energy security.

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Thailand and Southeast Asia

By having close relations with Thailand, and through infrastructural investment, Thailand could offer China a way to bypass the strait through a major infrastructural feat: a Kra Canal. Such a canal, if friendly to China, will allow Chinese ships to move directly from the Indian Ocean to the Gulf of Thailand and the South China Sea. While the project could pose problems for the Singapore economy, which is strategically positioned along the Malacca Strait, the initiative provides strong Singapore influence for international trade. Strategically, however, the military significance of the canal would not be harmful for the US as American presence in Singapore (and Thailand for that matter) still has flexibility to be active in the Gulf of Thailand. Economically, alleviating Malacca and Lombok traffic would be helpful for maintaining fluid movement between the South China Sea and the Indian Ocean.

However, the Thai government has confirmed that a Kra Canal is not presently on the agenda. At present, it seems a canal in Thailand is not the most pressing issue for geopolitics, but the future economic conditions provided by a canal in Thailand would be very beneficial for China. Well, there’s always the one in Nicaragua.

By AARON WALAYAT Apr. 4, 2016 on USCNPM