Escolar Documentos
Profissional Documentos
Cultura Documentos
by
Choen Krainara
Examination Committee:
External Examiner:
Nationality:
Previous Degree:
Scholarship Donors:
Thai
Master of Science in Urban Environmental
Management
Asian Institute of Technology
Thailand
Royal Thai Government-AIT Fellowship
ACKNOWLEDGEMENTS
The author would like to express his deepest gratitude to his Advisor Professor Dr. Jayant
Kumar Routray for providing vigorous guidance and inspiration throughout the course of
research. The researcher is extremely grateful to his Committee Members consisting of
Associate Professor Dr. Mokbul Morshed Ahmad and Assistant Professor Dr.Winai
Wongsurawat for contributing helpful comments and suggestions to advance this research.
A special appreciation is extended to Professor Dr. Sergio Pea for seving as external
examiner, as well as rendering constructive comments on the research. A particular
encouragement to the researcher for furthering doctoral study were supported by his
respective superiors at the Office of the National Economic and Social Development Board
(NESDB), namely H.E. Arkhom Termpittayapaisith Former Secretary-General of NESDB
and Dr. Porametee Vimolsiri, current Secretary-General of NESDB.
The researcher would also like to express gratefulness to those who rendered various
assistances during field research work. Notable thanks are extended to Chief of
Aranyaprathet district of Sakaeo province for providing insight on local border settings and
facilitation of cross-border movement for doing field research in adjacent OChrov district
of Cambodia. A particular appreciation is extended to the Governor of Banteay Meanchey
province of Cambodia for granting an interview and facilitation of field research in
Cambodia. Specific thanks are extended to both H.E. Apichart Petcharatana, Former Thai
Consul-General in Savanakhet province. Thankfulness is accorded to the Governor of
Savannakhet province for granting an interview and facilitating research work in Lao PDR.
Special thanks are given to Mr. Amonvit Onchanom for providing accommodation during
field research in Muang Mukdahan district. Heartfelt thanks are extended to Dr. Therdkiat
Chinsoranan, Mayor of Maesod City Munipality and Mr. Pramote Chantasri of Maesod
Municipality for facilitation, as well as arranging accommodation during field research in
Maesod district. A particular appreciation is also extended to all respondents for providing
insightful information.
Likewise, the researcher wishes to express particular gratitude for various forms of
assistances being given by Mr. Viroj Naosuwan, his close friend, Mr.Chavavai Krainara
and Miss Natthavee Krainara. He is grateful to Dr. Komwut Wissawapaisal and
Mr. Shahab Saqib Mohmand for providing assistance on statistical analysis. A particular
gratefulness is extended to Mr.Rey Calabdan for editing this research. A special note of
thanks also goes to the Royal Thai Government, AIT, and Dato Faudzi Naim Noh and
friends for generous supports in providing scholarships and research grant. Additional
special thanks are extended to the Mekong Institute for providing partial research grant.
The author wishes to dedicate this research for the advancement of the special border
economic zones in Thailand linking with counterparts in bordering countries of Cambodia,
Lao PDR and Myanmar in particular and for the ASEAN Community in general.
ii
ABSTRACT
Economic interdependence between Thailand and the surrounding less developed countries
has increasingly become much closer since the last few decades. Yet, considerable
development gaps seem to be widening causing persistently asymmetric relations. Since
2003, Thailand has planned to promote integrated development of border economic zones
(BEZs) with bordering countries. The aim of this study is to assess the locational
advantages, economic and social linkages and development potential of 3 strategic crossborder regions along the GMS economic corridors. The study areas included
(1) Aranyaprathet district in Sakaeo province bordering with OChrov district in Banteay
Meanchey province of Cambodia; (2) Muang Mukdahan district in Mukdahan province
bordering with Kaysone Phomvihane district of Savannakhet province in Lao PDR; and
(3) Maesod district in Tak province bordering with Myawaddy district in Kayin state of
Myanmar. The study is primarily a quantitative research design supplemented by a
qualitative research design. The study found that development of BEZs in Thailand is
intermittent and currently moving forward due to enabling policies. Fostered by both
geographical adjacency of structural differences and the contributing factors, the pattern of
local and regional cross-border trade, as well as cross-border transit trade have shown a
rising trend. Macro cross-border trade with Cambodia, Lao PDR, Malaysia and Myanmar
during 2008-2013 has reached significant level sharing average of 30.77 % to intraASEAN trade. Most of the cross-border trader and wholesaler respondents across the
regions are family-based businesses and mainly being SMEs. Thai goods are widely
accepted among bordering countries. However, cross-border traded goods are mainly
produced in Bangkok metropolis and its vicinity such as the eastern region. At present,
Thai border cities mainly play distribution role. Industrial respondents in Thai border
districts are mostly SMEs. The Thai border districts are more industrialized than the 2
bordering districts, except in Kaysone Phomvihane district of Lao PDR, which is more
industrialized than the counterpart bordering Muang Mukdahan district of Thailand.
Maesod district has become an important high-end fashion cluster of Thailand while
OChrov district of Cambodia specializes in low-end fashion products. There is an existing
spatial division of labor in Maesod district of Thailand. Household respondents across Thai
border districts have higher monthly household income than the counterpart respondents in
the bordering districts, ranging from 1.1 to 3 times. Complementary linkages exist for
sources of household income between Thai border districts and the counterpart bordering
districts, particularly on labor and cross-border outsourcing activities. Employment of
immigrant labor from bordering countries is widely practiced in economic and household
sectors across Thai border districts. Since 2004, there has been expanding cross-border
investment in the form of contract farming. During 2002-2014, there was a rapid increase
of local and regional cross-border people mobility across the regions. During 2009-2014,
there was also a rapid change in local and regional cross-border vehicle mobility across the
regions. Therefore, promoting holistic and integrated borderlands development policies
and strategies for 3 CBRs in Thailand towards ASEAN Community have subsequently
been recommended.
Keyword: special border economic zone; cross-border region; integrated borderlands
development; Greater Mekong Sub-region; ASEAN Community
iii
TABLE OF CONTENTS
CHAPTER
TITLE
PAGE
Title Page
Acknowledgements
Abstract
Table of Contents
List of Tables
List of Figures
List of Maps
Abbreviations
i
ii
iii
iv
vii
xi
xi
xii
Introduction
1.1 Background of the Research
1.2 Statement of the Problem
1.3 Conceptual Framework
1.4 Hypotheses of the Research
1.5 Objectives of the Research
1.6 Scope and Limitations
Literature Review
Section A:Relevant Theories and Concepts on International Trade 5
and Development
2.1 Classical and Neo-Classical Theory of International Trade
2.2 International Development
2.3 Regional Trade Bloc
2.4 Trade and Development
2.5 Spatial Division of Labor
Section B: Globalization, Regionalization and Cross BorderRegions
2.6 Relationship between Globalization and Regionalization
2.7 Convergent and Divergent Trends of Globalization and
Regionalization
2.8 Cross-Border Regions
Section C: Borderlands Development
2.9 Border Economics
2.10 Border Theories
2.11 Border Economic Zone and Applications
2.12 Consolidated Implications for Adopting Development of Border
Economic Zone Concept
11
11
Research Methodology
3.1 Type of Research
3.2 Type of Research Design
3.3 Unit of Analysis
3.4 Selection of Study Areas and Criteria
3.5 Sampling Design and Procedures
3.6 Target Informants
3.7 Data Sources
26
26
26
26
26
27
30
30
1
1
2
7
9
9
9
iv
11
11
12
12
13
13
13
14
15
18
18
18
20
24
3.8
3.9
4
31
32
33
49
68
79
33
39
46
49
49
49
49
50
50
50
51
51
52
52
52
56
60
64
65
68
74
75
77
7.1
7.2
8
79
100
102
137
137
169
10
171
196
196
214
214
225
228
References
235
Appendices
247
11
12
vi
102
114
124
134
171
171
193
201
207
212
LIST OF TABLES
TABLE
TITLE
2.1
2.2
2.3
2.4
2.5
3.1
3.2
3.3
PAGE
14
14
16
21
23
27
28
29
4.1
35
5.1
5.2
5.3
5.4
5.5
5.6
5.7
5.8
54
55
57
58
59
61
62
63
6.1
6.2
69
79
80
81
82
84
85
86
87
88
89
90
93
93
3.4
7.1
7.2
7.3
7.4
7.5
7.6
7.7
7.8
7.9
7.10
7.11
7.12
7.13
vii
30
74
7.14
7.15
7.16
7.17
7.18
7.19
7.20
7.21
7.22
94
94
95
96
97
98
98
99
100
8.1
8.2
8.3
8.4
8.5
8.6
8.7
8.8
8.9
8.10
8.11
8.12
8.13
8.14
8.15
8.16
8.17
8.18
8.19
8.20
8.21
8.22
8.23
8.24
8.25
8.26
8.27
8.28
8.29
8.30
8.31
8.32
102
103
104
106
107
108
109
110
111
112
113
113
114
115
116
118
119
120
121
122
123
123
124
125
126
127
128
129
130
131
133
133
9.1
9.2
9.3
9.4
9.5
138
139
140
142
144
viii
9.6
9.7
9.8
9.9
9.10
9.11
9.12
9.13
9.14
9.15
9.16
9.17
9.18
9.19
9.20
9.21
9.22
9.23
9.24
9.25
9.26
9.27
9.28
10.1
10.2
10.3
10.4
10.5
10.6
10.7
10.8
10.9
10.10
10.11
10.12
10.13
10.14
10.15
10.16
10.17
10.18
10.19
10.20
ix
145
147
148
149
149
151
152
153
154
155
156
157
158
159
161
162
162
163
164
165
166
167
168
173
174
174
175
176
177
178
179
180
182
183
184
184
185
186
187
188
188
190
191
10.21
11.1
11.2
11.3
11.4
11.5
11.6
11.7
11.8
11.9
12.1
12.2
12.3
192
LIST OF FIGURES
FIGURE
TITLE
PAGE
1.1
1.2
2.1
17
6.1
6.2
6.3
6.4
75
75
76
76
6
8
LIST OF MAPS
MAP
TITLE
PAGE
1.1
1.2
xi
2
4
ABBREVIATIONS
AC
ACMECS
ACDD
ACIA
ADB
AFTA
AIA
AICO
AISP
APEC
ASEAN
ATIGA
BOI
BEZ
BIMP-EAGA
CBR
CBTA
CEPT
CIQ
CIT
CLM
CLMV
ESB
EU
EWEC
GATT
GCC
GMS
GT
IAI
ICBTA
IGA
IMS-GT
IMT-GT
INDL
IL
ISN
KNLA
KNU
L.C.
MFN
MSMEs
MTS
NAFTA
NEDA
NESDB
ASEAN Community
Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy
ASEAN Customs Declaration Document
ASEAN Comprehensive Investment Agreement
Asian Development Bank
ASEAN Free Trade Area
ASEAN Investment Area
ASEAN Industrial Cooperation Scheme
ASEAN Integration System of Preference
Asia Pacific Economic Cooperation
Association of South East Asian Nations
ASEAN Trade in Goods Agreement
Board of Investment
Border Economic Zone
Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN
Growth Area
Cross-Border Region
Cross-Border Transport Agreement
Common Effective Preferential Tariff Scheme
Customs, Immigration and Quarantine
Corporate Income Tax
Cambodia-Lao PDR and Myanmar
Cambodia-Lao PDR-Myanmar and Vietnam
Eastern Seaboard
European Union
East-West Economic Corridor
General Agreement on Tariffs and Trade
Global Commodity Chain
Greater Mekong Sub-region
Growth Triangle
Initiative for ASEAN Integration
Initial Cross-Border Transport Agreement
Investment Guarantee Agreement
Indonesia-Malaysia-Singapore Growth Triangle
Indonesia-Malaysia-Thailand Growth Triangle
International Division of Labor
Inclusion List
Information Superhighway Network
Karen National Liberation Army
Karen National Union
Letter of Credit
Most Favoured Nation
Micro, Small and Medium Enterprises
Multilateral Trade System
North America Free Trade Area
Office of Neighboring Countries Economic Development
Cooperation
Office of the National Economic and Social Development Board
xii
NGOs
NICs
NSEC
NSW
OBM
OEM
POSEZ
RTAs
SBEZ
SEC
SIJORI
SMEs
SWOT
TNCs
UN
U.S.
VAT
WTO
Non-Governmental Organizations
Newly Industrialized Countries
North-South Economic Corridor
National Single Window
Original Brand Manufacturer
Original Equipment Manufacturer
Poipet ONeang Special Economic Zone
Regional Trade Agreements
Special Border Economic Zone
Southern Economic Corridor
Singapore-Johor-Riau
Small and Medium Enterprises
Strength, Weakness, Opportunity and Threat
Transnational Companies
United Nations
United States
Value-Added Tax
World Trade Organization
xiii
CHAPTER 1
INTRODUCTION
1.1 Background of the Research
Rapid globalization, which primarily resulted from trade liberalization in recent decades,
has driven the process of regionalization through the formation of trade blocs notably, the
Association of South East Asian Nations (ASEAN), in order to foster economic
complementarities and enhance regional competitiveness. As the progress of development
among ASEAN member countries is quite diverse, the programs consisting of the GMS
Development Cooperation and an Initiative for ASEAN Integration (IAI) have been
created in order to speed up the regional integration towards the goal of ASEAN
Community (AC) by the year 2015 (ASEAN Secretariat, 2009). The potential benefits
from the GMS cooperation are large. Nevertheless, different levels of development may
slow down the growth and full benefits of this sub-regional cooperation (Krongkaew,
2004). It is apparent that economic interdependence between Thailand and the least
developed neighboring countries have increasingly become much closer since the last
decades due to advancement of regional cooperation. Yet, considerable development gaps
seem to be widening due to stark differences on stages of development causing persistently
asymmetric relations. For example, labor cost in Thailand is higher than Myanmar, Lao
PDR and Cambodia at 3.7 to 5.2 times (TDRI, 2012). Thus, Thailand has attracted an
estimate of 6 million unskilled immigrant labor force and family members from these
bordering countries, which has accounted for 9.39% of total national population, to work
and live in the country (Manager Weekly, 2010). Meanwhile, a research conducted by
Prince of Songkhla University found that approximately 0.20 million southern Thai
nationals are out-migrating to Malaysia for jobs (Manager Online, 2008).
The illegal influx phenomenon of immigrants obviously prompts concerns over national
security in particular and subsequent multi-faceted impacts on Thai economy and society
in general. To complement the GMS, Thailand, which is located at the strategic
intersection of the mainland of Southeast Asian region, has initiated the Ayeyawady-Chao
Phraya-Mekong Economic Cooperation Strategy (ACMECS) in 2003 in order to bridge
development gaps with bordering countriesCambodia, Lao PDR, Myanmar and Vietnam
(CLMV) by promoting integrated cross-border development based on border economic
zone concept (Ministry of Foreign Affairs of Thailand, 2008). The GMS spatially adopts a
corridor development approach with a total of nine transborder economic corridors so as to
spearhead cross-border regional development linking both intra-GMS and South Asian and
East Asian regions (ADB, 2007). Out of nine, six GMS corridors are trans-Thai territory
(Map 1.1). Importantly, it strengthens the locational advantage of cross-border regions
towards emerging production and trade zones. This sort of BEZ was pioneered by
Maquiladora or export manufacturing sector, which have been developed to promote
employment along the 2,000 mile-long Mexico and the United States border since 1965
(Weiler and Zerlentes, 2003).
In the Asian region, this concept is proliferating during recent decades. Such zones have
been implemented, i.e. between Guangdong province of China and Hong Kong; between
Indonesia and Singapore; between Johor Bahru state of Malaysia and Singapore and
between North Korea and South Korea. Other existing BEZs along the GMS corridors are
between China and Myanmar; between China and Vietnam; between Vietnam and
region. This is due to the fact that Thailands existing economy size measured in terms of
Gross National Income Purchasing Power Parity and Gross National Income Per Capita is
relatively larger than Cambodia, Lao PDR and Myanmar. Consequently, notably different
stages of economic and social development between Thailand and those neighboring
countries have been observed. Therefore, this becomes a major influencing factor for
migratory out-flow of a large number of legal and illegal migrant labor from Myanmar,
Cambodia and Lao PDR seeking for jobs in Thailand.
Nevertheless, the advancement of physical connectivity in the form of economic corridors
coupled with a range of facilitations on trade, investment and peoples mobility in the
GMS, in particular, have dynamically opened up room to advance border economic zones
in Thailand. The striking substantiation has been the robust cross-border trade flows
between Thailand and neighboring countries since the last decade which consumers in
neighboring countries can gain a wider variety of access to cheaper quality goods from
Thailand. The trading patterns are becoming quite diverse depending on their comparative
advantage, division of labor and specialization of production. This cross-border trade has
mainly transacted through 71 border points which play important roles, either as collection
or distribution nodes. The locations of these border check points appear in Map 1.2.
Above all, the trend of aggregate cross-border trade tends to be growing, while the share of
aggregate international trade is likely to be declining, which corresponds to the greater
physical connectivity and accessibility in the GMS. Thailand alone seems likely to
constantly secure favorable balance of cross-border trade with less developed neighboring
countries, particularly, Cambodia and Lao PDR. It is clearly justified that these border
nodes in Thailand have been playing crucial roles not only to facilitate cross-border trade
and tourism but also to offer opportunity to perform as border production platforms for
goods and services, which are in vast demands in either immediate or nearby neighboring
countries. Such industrial productions at the borders could be endowed with locational cost
advantage, particularly, labor and access to supply networks in neighboring countries.
Combining locational advantages of the major borders with supportive Royal Thai
Governments initiative to foster closer economic integration and cooperation with less
advanced neighboring countries, it is thus rational to place particular priority for
developing border economic zones in three strategic cross-border regions of Thailand,
which are located along the GMS economic corridors as well as overlapping with Asian
and ASEAN Highways routes connecting with respective cities in bordering countries as
mentioned below:
1) Maesod district in Tak province bordering with Myawaddy district in Kayin state
of Myanmar. Maesod district of Tak province is currently a prominent investment
platform along Thailand-Myanmar border area. It also plays a significant role as major
industrial development location in Northern part of Thailand. Maesod district is home to
labor-intensive industry particularly for garment productions. In 2003, Tak province had
464 factories. Maesod alone hosted 235 factories, which accounted for 51% of the whole
provinces total investment capital of 1,500 million Baht, and generated export values of
3,100 million Bahtper year (NESDB, 2003). The key labor-intensive industries were textile
and garment, canned food, wood furniture, jewelry and accessories. In addition, there was
increasing emergence of service industries (e.g., garage and car maintenance shops, etc.).
The principal reason for investors in locating these industrial plants in Maesod was to take
advantage of cheap labor from Myanmar. In 2003, approximately 10,000 Myanmar
workers were employed in Maesod district. By developing Maesod as border economic
zone, this location can help penetrate manufactured products and services not only to
Myanmar but also to Bangladesh, India, Srilanka, Nepal and Bhutan, etc.
6
Source: Adapted from Vimolsiri, P. (2008). Sub-regional Cooperation in GMS, ACMECS and IMT-GT: The Way Forward to Regional Integration,
NESDB, Bangkok.
Figure 1.1 Proposed Border Economic Zones in Thailand and Its Potential Linkages with Neighboring Countries
Furthermore, it should be noted that the larger size of Thai economy could lead to
excessive extraction of resources from those less developed neighboring countries which
can exacerbate international development gaps in the Greater Mekong Sub-region.
Therefore, it is still a challenge for Thailand to find ways of using border economic zone as
a means to not only bridge interregional and intra-regional disparities in Thailand, but also
to promote spillover effects towards cross-border regional development in the Greater
Mekong Sub-region in order to ultimately help narrow international development gaps
with these less advanced neighboring countries.
In order to cultivate closer economic integration with neighboring countries, a series of
feasibility studies on establishing border economic zones in Thailand have been conducted
in specific locations (e.g., Maesod district in Tak province, Mukdahan province, as well as
in Sadao district of Songkhla province and Chiang Rai province). However, the results
were general analysis and mainly emphasized on development in the Thai context with
limited empirical evidences to strengthen cross-border linkages with cities in neighboring
countries. Therefore, there is no existing document relevant to cross-border interactions
between Thailand and the surrounding less advanced countries particularly for the above
mentioned 3 cross-border regions. As a result, little is known on how Thailand could
further foster cross-border co-production practices under the border economic zone
framework towards integrated borderlands development in response to increasing regional
economic integration.
1.3 Conceptual Framework
The conceptual framework of the research covers an important array of cross-border
interactions and trade induced prospect for developing border economic zones in Thailand
and linkages with the cities in neighboring countries namely Myanmar, Cambodia and Lao
PDR. It is shown in Figure 1.2 below.
Policy Instruments
Locational Advantages
Locational advantages of strategic cross-border regions along GMS
Economic Corridors and Asian and ASEAN Highway routes:
Maesod district in Tak province links with Myawaddy district in
Kayin state of Myanmar;
Aranyaprathet district in Sakaeo province connects with OChrov
district in Banteay Meanchey province of Cambodia; and
Muang Mukdahan district in Mukdahan province links with Kaysone
Phomvihane district in Savannakhet province of Lao PDR
-Composition
of population
-Local
livelihoods
Economic aspect
Trade
-Cross-border
trade
-Border
wholesale
-Border retail
-Cross-border
shopping
Agriculture
-Cross-border
contract
farming
Industry
- Types of
industries
-Local,
regional and
cross-border
out-sourcing
Social aspect
Investment
- Crossborder joint
venture
Tourism
- Crossborder
people and
vehicle
mobility
- Primary
education
-Secondary
education
- Home
ownership
-Immigrant
labor
movement
Recommendations of strategies to integrate border economic zones in the context of regional and national development
10
CHAPTER 2
LITERATURE REVIEW
The literature review is carried out in order to seek out theoretical and empirical
developments relevant to the research topic. It covers a range of global and regional
context, key concepts on international trade, border theories and development of border
economic zones. This can help converge greater understanding on both theoretical
background and actual practices. The coherent contents of the literature review are as
follows:
Section A: Relevant Theories and Concepts of International Trade and Development
2.1 Classical and Neo-Classical Theory of International Trade
David Ricardo initially grounds classical international trade theory so called comparative
advantage in 1817. He states that other things being equal, a country tends to specialize in
and exports those commodities of which it has maximum comparative cost advantage.
Similarly, the country's imports will be of goods having relatively less comparative cost
advantage (Sumitr and Worabuntoon, 2004). Since then, the international trade model has
been evolving over time influenced by increasing complex factors and technological
changes, which gave rise to emergent neo-classical international trade theories. Among
others, Ohlin (1933) proposes resources and trade theory, in which trade occurs from the
differences of resources between two countries. He states that a country will export goods
that use its abundant factors intensively, and import goods that use its scarce factors
intensively. In the two-factor case, he states that a capital-abundant country will export the
capital-intensive goods, while the labor-abundant country will export the labor-intensive
goods. Tinbergen (1962) rationalizes the gravity model that bilateral trade between any
two countries is positively related to their economic sizes and negatively related to the
relative trade costs between them. Currently, this model has been practically applied to
analyze implications and impacts of various regional trade agreements in the world.
Krugman (1980) further conceives home market effect, which is the tendency for large
countries to be net exporters of goods with high transport costs and strong scale of
production. Hanson and Xiang (2004) conducted empirical research on the home market
effect and bilateral trade patterns. They found that for industries with very high transport
costs, the national market size determines national exports. For industries with moderately
high transport costs, it is the neighborhood market size that matters. In this instance,
national market size plus market size in nearby countries determine national exports.
2.2 Concept of International Development
At global scale, there is existence of uneven global patterns of economic and social
development, which shapes international division of labor. Wallerstein (1974) classifies
the world into areas and nations ranging from core states, semi-peripheral and peripheral
areas, so called World System Theory. Classification depends on stage of development and
control over resources. Core areas are in geographically advantaged parts of the world such
as Europe and North America. The semi-peripheral areas are somewhat intermediate; both
being exploited by the core and take some role in the exploitation of the peripheral areas.
While the peripheral areas are the least developed; they are exploited by the core for their
cheap labor, raw materials and agricultural production. The core-periphery model is
applicable to all spatial levels. At national scale, globalization and regionalization also
11
affect both urban and regional development. Three perspectives are influential in
explaining the spatial divisions of labor through the emergence of regional production
network coordinated by transnational companies (TNCs), which contribute to the rise of
Asia as major center of global production and trade. Firstly, the new International Division
of Labor (INDL) perspective, which Frobel et al. (1980) have identified two qualitative
characteristics. These are (1) an increasing production of manufacturing goods competitive
in the world market is now situated in developing countries, and (2) there has been an
increasing subdivision and fragmentation of commodity production to take advantage of
uneven spatial distribution of factor costs through a correct combination of labor and
capital. Different parts of the labor process may now be spatially separated so that labor
intensive production can be relocated to developing countries to take advantage of the
cheap labor there. The free application of peripheral labor power applied to specific labor
processes in the cores is one distinctive trend. Secondly, to link production in developing
countries with the global economy via TNCs, Gereffi et al. (1964) have defined the global
commodity chain (GCC) approach, which is a specific configuration of sets of interorganizational networks clustered around one commodity or product, linking households,
enterprises and states to one another within the world economy. Thirdly, the flying geese
model is the formation of Japanese regional production networks, converged by changing
factor endowments in individual host countries and the technological superiority of
Japanese firms. As a result, the division of labor in Asia is becoming more vertical (Hatch
and Yamamura, 1996).
2.3 Concept of Regional Trade Bloc
At regional scale, globalization drives economic integration into six stages, namely,
preferential trading area, free-trade area, customs union, common market, economic and
monetary union and complete economic integration (Carbaugh, 2009). Since the mid1980s, there has been a profound change in the structure of the international economy due
to the widespread growth and internal enhancement of regional trading blocs in all parts of
the globe. Thus, countries will cooperate in regional trade blocs for two specific reasons;
one is to gain welfare ultimately for their own citizens. The second is to obstruct the
welfare gains from trade for those states that they consider unfriendly (Reardon, et al.
2002). Regional Trade Agreements (RTAs) are a major instrumental feature of todays
multilateral trade system (MTS). The number of preferential agreements, as well as the
world share of preferential trade has been steadily increasing over the last five decades.
Sluggish progress in multilateral trade negotiations under the Doha Development Round
appears to have accelerated further the rush to forge RTAs (Crawford and Fiorentino,
2005). As of March 2011, the GATT/WTO has been notified of 297 effective RTAs
(WTO, 2011). In East Asia alone, there were 50 agreements in place, and another 80 or so
currently being prepared (ADB, 2011). As a result, it is intensifying trend of intra-regional
trade. In 2008, the share of intra-regional merchandise trade in Europe, Asia and North
America were as high as 72.80, 50.10 and 49.80% of total regional exports, respectively
(WTO, 2009).
2.4 Concept of Trade and Development
In terms of contribution of trade for competitiveness development, Porter (1990) conceives
internationally competitive advantage of nations for particular industry, which consists of 4
determinants, namely, factor conditions, demand conditions, related and supporting
industries, and firm strategy, structure and rivalry. To deepen insight on trade for
12
development, Krugman, Obstfeld and Melitz (2010) suggest a trade model on specific
factors and income distribution focusing on 3 factors, namely, labor, capital and territory.
They state a country having capital abundance and less land tends to produce more
manufactured products, while a country with territory abundance tends to produce more
food. Products and services to be traded are obtained from industries which use different
factors and resources in the production, thus, enhancing income distribution. Krugman,
Obstfeld and Melitz (2010) also introduce another standard model of trade which
combined ideas from the Ricardian model, specific factors and the resource and trade
model. They state, under constant circumstance, the exchange rate improvement for a
country implies a substantial rise in the welfare of that country. Concerning trade for
national development, UN Millennium Project (2005) emphasized that trade openness can
be a powerful driver of economic growth, which is indispensable to reduce poverty and
foster a countrys development. Trade alone cannot induce for achieving development; it
should therefore be associated with other institutional, macroeconomic and microeconomic
conditions plus well designed social policies to attain development. On the other hand,
opening up markets to international trade may leave local producers flooded with more
competitive foreign producers. Sustained strong economic growth over longer periods is
strongly related to poverty reduction. Therefore, trade and economic growth are strongly
linked. Countries that develop always enhance their integration with the global economy
through export-led growth strategy.
2.5 Theory of Spatial Division of Labor
Massey (1984) conceives the spatial division of labor, which is a functional division
between regions within an industry. She identifies 3 types of companies consistent to their
approach to utilize the different spatial structure between regions. These are:
(1) Locationally concentrated spatial structure - the company trades only in one region,
localizes its activities in this area, which means it fails to utilize regional differences;
(2) Cloning spatial structures - it is identified by the company trading in several regions
with the head office located in metropolitan or core area while other branch offices are
located in the periphery regions. Branch offices are not connected much and the plants are
linked to other companies in the regions (e.g., subcontractors); and (3) Part-process spatial
structure - branch offices are much less vulnerable. This system is based on branch offices
producing only a part of the product and companies locate their branch offices in regions
corresponding to the requirements of production.
Section B: Globalization, Regionalization and Cross-Border Regions
2.6 Relationships between Globalization and Regionalization
Sum (2002) particularly distinguished the relationships between supranational
regionalization, which is represented by the emergence of regions such as the European
Union (EU), North America Free Trade Area (NAFTA), Asia Pacific Economic
Cooperation (APEC) and Association of Southeast Asian Nations (ASEAN) and
globalization in two main ways. First, the old regionalists perceive regional trading bloc
formation as a means to reduce dependence on the wider global economy. This approach
stated globalization and regionalization as divergent or even opposed trends. Second, the
new regionalists, in contrast, presented a geo-economic explanation to replace the old
geopolitical view. They proposed regionalization strategies are no longer linked to the need
to reduce dependence on the global economy but are oriented to promoting globalization
13
Table 2.2 the Main Growth Triangles in Asia since the Early 1980s
Name
Date of inception
Greater China
Early 1980s
1989
Indonesia-Malaysia Thailand
Growth Triangle (IMT-GT)
1993
1994
1991
1991
Source: Adapted from Ling Sum, N. (2002). Globalization, Regionalization and Cross-Border Modes of
Growth in East Asia: the (Re-) Constitution of Time-Space Governance, in Perkmann, M. & Ling
Sum, N. (Eds.), Globalization, Regionalization and Cross-Border Regions (pp.50-76). New York:
Palgrave Macmillan.
14
networks that are seeking to capture these global flows and refix them in time and space.
More specifically, the de- and re-terrritorialization processes between the 1980s and the
1977 Asian crisis have promoted a general convergence between globalization and
regionalization. Sum (2002) highlighted that such convergence takes two concurrent and
interrelated paths. First, the regional-globalization direction involved local-nationalregional actors taking the initiatives to reterritorialize the global flows of production,
finance and trade across bordering spaces. Second, the global-regionalization track can be
seen in terms of global actor seeking to regionalize their global neoliberal regime of truth
and practices in Asia-Pacific through the APEC. The emergence and expansion of crossborder regions or growth triangles in East Asia can be seen as part of the first path, in
which regional-national actors expand and relocate embedded exportism to new sites.
Please see the convergence of globalization and regionalization in East Asia in Table 2.1
below. There were linkages between the growth triangles and APEC. The growth triangles
play facilitating role, while the APEC serves an enabling role.
Sum (2002) commented that the loosely organized network nature of the APEC and the
lack of formal agreement have provided room for further expansion of embedded
exportism commenced by other NICs, for example, Singapore. Taking on the success of
the self-organized activities across the Greater China border, Singapore constructed the
cross-border region of Singapore-Johor-Riau (SIJORI)/Indonesia-Malaysia-Singapore
(IMS) as a growth triangle (GT) in December 1989. The identification of this crossborder space as growth triangle stressed the complementarities of these sites in building
sub-regional economic cooperation. During the early 1980s and the 1997 Asian crisis, there
were three stages of growth triangle development, namely: stage 1 with ethnic
networking (Greater China); stage 2 with outward-oriented investment regions (for
example, SIJORI); and stage 3, growth triangle as portable strategy or ADB program.
Simultaneously, Japan also sought to further its regional-globalization by initiating the
growth triangle, which is considered as powerful tool for the promotion of export
competiveness. Than et al. (1994) cited in Sum (2002) found five key factors of success in
different growth triangles consisting of economic complementarity, geographical
proximity, policy commitment, policy coordination and infrastructural development. Please
see the main growth triangles in Asia in Table 2.2.
2.8 Cross-Border Regions
At cross-border scale, Perkmann and Sum (2002) have termed cross-border region (CBR)
as a territorial unit that comprises contiguous sub-national units from two or more nationstates. Than (1997) cited by Jessop (2002) states that trade, based on geographical
proximities and complementarities, has flourished throughout history at the regional and
sub-regional level unless participating countries have prohibited cross-border transactions
for political, security or economic reasons. CBRs may engage creating competitive
advantage by exploiting complementarities among sources of supply, for example
Singapore-Johor-Riau (SIJORI) growth triangle, EU member states and post-socialist
economies. Jessop (2002) proposes that there are at least 9 ways in which CBR have
emerged. These are: (1) CBRs may result from recent selective reinforcement of obscure
forms of economic and political organization that have long existed on the borders of
states, even if disapproved by their respective national states; (2) CBRs may involve a
resurgence of suppressed (but potentially still viable) historical economic spaces following
the end of the cold war and the collapse of the Iron Curtain. The examples are Greater
China, the Greater Mekong Sub-region and the Singapore-Johor-Riau (SIJORI) growth
15
triangles; (3) CBRs may emerge from or be reinforced by the spillover of metropolitan
hinterlands and/or the development of complementary towns in either side of a shared
border; (4) CBRs may come from creation of new functional economic spaces, where there
are complementary resources, common problems or a shared peripheral status prompting a
need for cooperation on issues such as the environment or transport infrastructure. The
examples consist of growth triangles, export-processing zones, innovation setting, gateway
cities and learning regions; (5) CBRs may be promoted by national states in the hope of restabilizing the national scale and enabling national economies to compete more effectively.
This involves re-bordering and de-bordering; (6) CBRs may be supranational bodies that
promote CBRs to undermine the national scale through an initiative arising from above and
below; (7) CBRs may be a reaction to uneven development linked with other sub-, supra-,
Table 2.3 Major Features and Variations in the Level of Interaction in Borderlands
Types of borderlands
Features
Degree of
transnationalism
1. Tension prevails.
None to low
1.Alienated
2. Border is functionally closed, and crossborderlands
border interaction is totally or nearly totally
absent.
3. Residents of each country act as strangers to
each other.
1. Stability is an on and off proposition.
Low to moderate
2.Co-existent
2. Border remains slightly open, allowing for
borderlands
the development of limited binational
interaction.
3. Residents of each country deal with each
other as casual acquaintances, but borderlands
develop closer relationships.
1. Stability prevails most of the time.
Moderate to high
3. Interdependent
2.
Economic
and
social
complementarity
borderlands
prompts increased cross-border interaction,
leading to expansion of borderlands.
3. Borderlands carry on friendly and
cooperative relationships.
1. Stability is strong and permanent.
High to very high
4. Integrated
2. Economies of both countries are functionally
borderlands
merged and there is unrestricted movement of
people and goods across the boundary.
3. Borderlands perceive themselves as
members of one social system.
Source: Martinez (1994) cited in Yang, C. (2006). The Pearl River Delta and Hong Kong: an evolving crossboundary region under one country, two systems, Habitat International 30, 61-86.
16
Source: Kratke, S. (2002). Cross-Border Cooperation and Regional Development in German-Polish Border
Area, in Perkmann, M. & Ling Sum, N. (Eds.), Globalization, Regionalization and Cross-Border
Regions (pp.125-147). New York: Palgrave Macmillan.
17
hierarchy of these cities responds to external factors than internal ones. Sassen (2001)
deliberates that there are also tendencies towards specialization among different cities
within a country.
Concerning dynamic internal borders, Houtum (2000) defines trends within geographical
studies in terms of the European Union integration process and discovers commonalities of
themes and methods within them. He then found three different approaches of European
economic and regional geographical border studies, which comprise flows and barriers,
cross-border cooperation, and people. Brunet Jailley (2005) conceptualizes the theory of
borderland studies. He hypothesizes that if each analytical lens enhances or complements
one another, what emerges is a borderland region that is culturally emerging and is
integrating. The four equally important analytical lens include: (1) Market forces and trade
flows - flows of goods, people and investments span the border and borderland; (2) Policy
activities of multiple levels of government on adjacent borders - multilevel governance
spans the border to link Type 1 (local, regional, provincial, state and central governments)
and Type 2 (task specific public and private sector organizations); (3) Local cross-border
political clout - active local civic and political organizations and individuals initiate and
expand local level relations, local policy network, local policy communities, symbolic
regime and local cross-border institutions. All span the border and borderland; and
(4) Local cross-border culture - sense of belonging, common language or ethnic, religious,
and socio-economic background span the border and borderland.
Boehmer and Pena (2012) theorize the determinants of open and closed borders. They
found that the greater the differential in development between neighboring states, the less
likely the richer state will be open to citizens from its poorer neighbor. The presence of
urban settlements, enduring peace and democracy increase the likelihood of border
openness between neighboring states, although international trade has no effect on the
degree of openness. Using a planning perspective, Haselsberger (2014) proposes normative
border concept. It is classified into thick and thin borders. Thick borders are extremely
rigid. While Thin borders are permeable for certain kinds of flows. Haselsberger (2014)
also introduces a dynamic border interpretation framework seeking to create a fundamental
basis in understanding how the different functions and components of boundaries work
together to constantly create and diminish borders. She classifies borders into 4 categories
namely geopolitical, sociocultural, economic and biophysical boundaries.
In relation to emergence of cross-border metropolitan region, Van Geenhuizen and Ratti
(2001) rationalizes the advantages that flow from a greater opening up of borders are
linked to three factors. These are the presence of opportunities for interaction, the limited
impact of any residual barriers, and the capacity of actors to face new challenges. Sohn
(2012) further identifies the forms the border as resource can take for cross-border
metropolises by using four advantages. Firstly, the border as positional benefit: It results
from putting forward the border function of demarcation. The moment a border opens up,
border areas present the undeniable advantage of being located close to the bordering
region helping reduce transport costs. Cross-border metropolis can lead to two particular
forms of advantage. The first results from the gateway status to which certain cities close
to a border can aspire. On the one hand, the function of territorial gateway makes it
possible to capture international flows, people or goods. On the other hand, the proximity
of foreign markets creates opportunity for export businesses (Niebuhr and Stiller, 2002).
Secondly, the border as differential benefit: It rests on the ability to harness the
comparative advantage to be had from border differentials relating to costs (labor, land,
19
20
Disadvantages
Sources
1. Impressive economic
performance during 1980s and
1990s. In the early 1993, more than
2,000 plants were established,
mostly foreign owned and
employed over 500,000 workers.
Brannon et al.,
1994 and CarrilloHuerta and
Urquidi, 1989
cited in Brannon
et al., 1994
2. The establishment of
Maquiladoras and subsequent
growth represent a major change in
Mexicos import substitution and
foreign investment policies. And
Maquilas were in a very
competitive position because the
laws were well-established and
working smoothly by the time
NAFTA went into effect in January
1994.
3. The Maquila is a key economic
driver and attractor of workforce.
Further, the maquiladora industry
21
Brouthers et al.,
1999
Advantages
Disadvantages
Sources
Samstad and
Pipkin, 2005
Compiled by the
Author.
22
Bordering
Countries
Year of
Establish
ment
2003
Employ
ment
Area
NA
NA
Export processing
zone, free trade zone,
free service and logistic
center
NA
2. Myawaddy Special
Border Economic Zone in
Kayin state
3. Iskandar Malaysia
in Johor state
Myanmar and
Thailand
2008
NA
173
hectares
Malaysia and
Singapore
2006
NA
Vietnam and
Cambodia
2003
NA
221,634.1
0 hectares
(2,216.3
Km2)
34,197
hectares
Vietnam and
Cambodia
2005
NA
21,283
Hectares
Vietnam and
Lao PDR
2005
NA
NA
NA
China and
Myanmar
1992
NA
NA
8. Wanding Border
Economic Cooperation Zone
in Yunnan province
China and
Myanmar
1992
NA
6 Km2.
China and
Vietnam
1993
NA
NA
2003
By 2012,
created
725,000
jobs
By 2012,
covered
25 Sq.
mile
An economic,
industrial and services
cluster
Wood processing,
office products,
handicrafts,
manufacture of
electronic components,
electrical appliances,
household goods and
garments
NA
24
25
CHAPTER 3
RESEARCH METHODOLOGY
In order to carry out the preceding research objectives, the research design has consistently
been undertaken following essential research methodology elements. The detailed research
design and procedures are as follows:
3.1 Type of Research
This comparative study is a combination of descriptive and explanatory research with
distinct justifications as follows:
Descriptive research in the sense that it presents a picture of the specific
details of economic and social settings of the studied cross-border regions between
Thailand and neighboring countries including Cambodia, Lao PDR and Myanmar, as well
as highlights cross-border interactions.
Explanatory research in the sense that it explains cross-border linkages in order to
rationalize on why it happens in that way, as well as proposes prospective integrated
development strategies of joint cross-border economic zones.
3.2 Type of Research Design
It is primarily a quantitative research through survey design utilizing various types of
questionnaires. The research is also supplemented with qualitative research design
employing multiple methods, namely, reconnaissance survey, key informant interview,
non-participant observation and focus group discussion with border community leaders.
3.3 Unit of Analysis
There are multi-unit of analysis covering household, individual business unit or company,
industrial plant, border city, national and bilateral levels. Multi-unit of analysis is helpful to
reflect linkages between different dimensions of study. These are derived from the above
mentioned objectives. Please find a detailed research coordination schema in Appendix A.
3.4 Selection of Study Areas and Criteria
The selection of study areas mainly apply purposive sampling based on the specific
criteria, in which it should be the most strategic cross-border regions linking Thailand with
neighboring countries consisting of Cambodia, Lao PDR and Myanmar. The study areas
possess highest development potentials of becoming special border economic zones due to
strong intensity of cross-border trade flow, people and vehicle mobility and local border
industrial development. The study areas likewise are located along the GMS economic
corridors, as well as overlapping with Asian and ASEAN Highways routes. As a result, the
study areas corresponding to the above mentioned criteria are as follows:
Cross-Border Region 1: Aranyaprathet district in Sakaeo province bordering with
OChrov district in Banteay Meanchey province of Cambodia;
Cross-Border Region 2:Maesod district in Tak province bordering with Myawaddy
district in Kayin state of Myanmar; and
Cross-Border Region 3: Muang Mukdahan district in Mukdahan province
bordering with Kaysone Phomvihane district in Savannakhet province of Lao PDR.
The locations of these cross-border regions appear in Figure 1.1.
26
Thailand
Aranyaprathet district in
Sakaeo province
Number of population
Border
Border
Crossretailers
wholesalers border
traders
NA
NA
37
30
22
(22 are in
operation )
15
NA
15
31
15
Cambodia
OChrov District of
Banteay Meanchey
province
Thailand
Muang Mukdahan
465
NA
75
57
30
district in Mukdahan
province
Lao PDR
Kaysone Phomvihane
NA
NA
56
30
30
district in Savannakhet
province
Thailand
Maesod district in Tak
NA
59
100
30
33
province
Myanmar
Myawaddy district in
NA
NA
NA
30
30
Kayin state
Total
465
74
283
226
171
Source: Number of cross-border traders obtained from border customs authorities in Thailand,
Cambodia and Lao PDR in 2009.
Number of border retailers and wholesalers obtained from field surveys.
Note: NA stands for no exact data are available.
27
15
30
30
54
30
181
30
30
332
28
(18) Machinery
(19) Electrical machinery and supplies
(20) Transport equipment
(21) Other manufacturing industries
The specific types of industrial plants operated in the cross-border regions between
Thailand and Myanmar, Cambodia, and Lao PDR are identified in accordance with the
above classification of industries. There are a total of 253 samples which appear in Table
3.3 below.
Table 3.3 Industrial developers in the study areas and numbers of sample size in 2009
Cross-Border
Region
Number
of
Factory
Capital
Investment
(Million
Baht)
Thailand
Aranyaprathet
district in Sakaeo
province
40
(20
factories
in
operation)
NA
456.30
Labor Force
(Person)
Male
Female
293
611
Total
Labor
Force
(Person)
904
Number of
Sample
Size
(Number
of Factory)
20
NA
NA
NA
NA
30
Cambodia
OChrov District
of Banteay
Meanchey
province
Thailand
Muang district in
227
2,872
1,803
600
2,403
43
Mukdahan
province
Lao PDR
Kaysone
412
NA
NA
NA
NA
61
Phomvihane
district in
Savannakhet
province
Thailand
Maesod district
251
2,055.99
9,704
25,298
35,002
69
in Tak province
Myanmar
Myawaddy
NA
NA
NA
NA
NA
30
district in Kayin
state
Total
910
5,384.29
11,800
26,509
38,309
253
Source: Provincial Industrial Development Offices in the border cities of Thailand and Lao PDR in
2009.
Note: NA means there is unavailable of exact data.
4) Local border households. Using survey questionnaires, the study conducted interview
of heads of local border households. A total of 529 samples across the cross-border regions
are covered. The sampling size in a particular cross-border region is shown in Table 3.4.
29
87,018
33,554
58
Cambodia
129,315
25,950
103
OChrov District of Banteay
Meanchey province
128,886
41,516
101
Thailand
Muang Mukdahan district in
Mukdahan province
Lao PDR
Kaysone Phomvihane district in
117,821
19,018
159
Savannakhet province
Thailand
Maesod district in Tak province
119,471
44,977
78
Myanmar
Myawaddy district in Kayin
53,000
10,150
30
state
Total
635,511
175,165
529
Source: Numbers of population and numbers of household gathered from district offices in the
studied border cities of Thailand, Cambodia, Lao PDR and Myanmar.
Note: Normal sample sizes are based on sampling calculation. But sample sizes in both OChrov
district in Cambodia and Kaysone Phomvihane district in Lao PDR are collected above
minimum statistical sampling requirements due to convenient arrangements during field
surveys.
30
Statistical Offices, Office of the Board of Investment, Bank of Thailand, Office of the
National Economic and Social Development Board (NESDB), line ministry agencies,
provincial commercial offices, industry and transport offices, provincial and national
chamber of commerce and relevant internet websites). They are also collected from similar
organizations in Myanmar, Cambodia and Lao PDR. Such required data across the crossborder regions consist of profiles of the study locations, statistics of cross-border trade and
tourism flows between Thailand and Myanmar, Cambodia and Lao PDR, existing urban
development, statistics on industrial and commercial registrations, joint venture company
registrations, cross-border outsourcing activities, current value chain management and
statistics on border infrastructure, logistics and services.
3.7.2 Primary Data Sources. Primary data are gathered from various sources as
follows:
Survey using questionnaires covering demographic, economic and social aspects of
cross-border traders, border wholesalers and retailers in the cross-border regions are
conducted. Please find detailed questionnaires in Appendix B, C and D.
Questionnaires of cross-border shoppers appear in Appendix E.
Local border industrial developer questionnaires appear in Appendix F.
Local border household questionnaires are shown in Appendix G.
Checklist for focus group discussion with community leaders on perceptions of
development dynamics of border cities towards promotion as border economic zones
appears in Appendix H.
Checklist for key informant interview of border provincial governors appears in
Appendix I.
Checklist for key informant interview of border provincial chamber of commerce,
industrial federation and cross-border logistics service providers appears in Appendix J.
3.8 Data Collection Methods
The data collection methods employed are as follows:
3.8.1 Primary Data Collection Methods. It is linked with 3.7.2 where secondary data
are unavailable. At least 5 methods are subsequently applied which are:
1) Reconnaissance survey. It was undertaken in July 2009 in order to get oriented to the
study areas and to be familiar with local border people in the study areas. It was also
helpful to search for records or statistics relevant for research, as well as to identify
necessary resources and contacts needed in carrying out the research.
2) Questionnaire survey. It was conducted in August 2009 to February 2012 by asking 6
target groups of informants comprising of cross-border traders, border wholesalers and
retailers, cross-border shoppers, border industrial developers and border households.
3) Non-Participant Observation. It was performed both during reconnaissance surveys
and while conducting field questionnaire surveys. This could help in gaining insights on
characteristics of study areas, socio-economic and cultural interactions, problems of crossborder trade, infrastructure development and services, urban development patterns, urban
environmental problems, community life styles, people and vehicle mobility at the crossborder regions between Thailand and Cambodia, Lao PDR and Myanmar.
4) Key Informant Interview/Checklist. This was carried out through interview with
major stakeholders including local and provincial administration, customs and trade
31
officials, border and provincial industrial developers and local border community-based
enterprises, local border NGOs in the cross-border regions, etc.
5) Focus Group Discussion. This was held to collect data from community leaders on
communities perception and impacts resulting from changing border economic and social
conditions (e.g., employment of illegal immigrant labor from neighboring countries, likely
formation of community-based enterprises and linkages with local industries, as well as
impact of governments policies on cross-border contract farming, etc.).
3.8.2 Secondary Data Collection Methods. It is linked with 3.7.1 by conducting
thorough literature review from various sources (e.g., journal articles, internet websites,
books, government and private sectors reports and relevant statistics of government
organizations, etc.).
3.9 Selected Data Analysis and Techniques
The study uses both qualitative and quantitative analysis and techniques as follows:
3.9.1 Quantitative analysis This consists of:
Locational and trend analysis focus on flows of cross-border trade of goods,
vehicle and peoples mobility and cross-border contract farming.
Descriptive statistics are frequency, percentage, mean and standard
deviation and statistical tests e.g., Chi Square and Fisher Exact.
3.9.2 Qualitative Analysis This applies literature review, content and policy
analysis, as well as comparative cross-border and SWOT analysis.
Results of the above mentioned analysis are presented in the form of graphs, tables and
charts.
32
CHAPTER 4
POLICY ANALYSIS: DEVELOPMENT OF SPECIAL BORDER
ECONOMIC ZONES IN THAILAND
This chapter presents policy analysis in Thailand conducive to development of special
border economic zones. It includes evolution and analysis of current special border
economic zone development policies. It seeks to understand why and how the policy is
developed at a particular time and the intended effects of those policies.
4.1 Evolution of Special Border Economic Zone Development Policies in Thailand
Thailand adopts 5-year national development plan to guide development paths. Over 54
years of national development planning, spatial development policies are continually
evolving in line with national and sectoral development progress, which can be classified
into 4 distinct periods. Each period is characterized by specific spatial development
advancement. The first period (1961-1966) focuses on developing key infrastructure
projects as backbone for national development, as well as attracting private investments.
The second period (1967-1981) emphasizes on promoting regional and rural development
including creating jobs and income distribution to peripheral regions. The third period
(1982-2001) adopts Area Approach planning for identifying development programs and
projects by promoting regional development, which concentrates on fostering regional
growth centers and the Eastern Seaboard Development Program. It also focuses on urban,
rural and specific areas development. The fourth period (2002-2015) recently shifts
towards upholding rural-urban relations and development of special border economic
zones (SBEZs) along the Greater Mekong Economic Corridors in order to grasp potential
of proliferating regional cooperation and integration programs particularly for the
Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS), the
Greater Mekong Sub-region Economic Cooperation Program, and the ASEAN Economic
Community as integral part of the ASEAN Community.
To materialize the concept of SBEZ, its ultimate goals are not only to reduce both interregional and intra-regional disparities, but also to create production bases along border
areas, as well as coping with border labor shortage. It also aims to minimize impacts of
continuing influx of illegal immigrant labor and low quality agricultural produce from
neighboring countries into Thailand. Yet, progress has been gradually made because this
concept is truly new for Thailand. As a result, different efforts have been made in various
governments. Chronologically, the Thaksin Administration initially announced to promote
the first SBEZs in both Chiang Rai and Tak provinces since 2003. However, it encountered
severe resistance from both local authorities and general public who were aware of being
profoundly displaced from their local administration function by new local authorities
under the proposed special border economic zone law. This subsequently generated wide
criticism on pros and cons of the SBEZ within Thai society. Coupled with political
discontinuity, the initiative to implement these two pilot SBEZs was consequently sluggish
for almost 8 years.
As Thailand approached full entry into the ASEAN Community by the end of 2015, the
Abhisit Administration reapproved on October 19, 2010 to develop Maesod district in Tak
province as a pilot special border economic zone. On March 22, 2011, a total budget of
14.04 million Baht was then allocated to carry out a research for the formulation of
development plan of Maesod Special Border Economic Zone. In 2013, the Yingluck
33
34
35
Table 4.1 Brief Integrated Development Policies for Special Border Economic Zones in Thailand
Major Policies
Major Features
Execution of Policies (Translated into
action)
Direct Policies
(Explicit Policies)
It serves as core national policy in driving A mechanism to run the SBEZs has been
Policy 1: Special
SBEZ development. At present, the set up by assigning 4 main organizations
Border Economic
Prayuth
Administration
is
keenly to oversee the implementation process
Zone Development
expediting implementation of 10 SBEZs comprising of the Office of the National
Policy
across Thailand dividing it into 2 phases. Economic and Social Development Board
On January 15, 2015, the Prayuth (NESDB), Office of Board of Investment
Government approved 5 pilot SBEZs (BOI), Ministry of Foreign Affairs and
urging to realize early tangible progress by Ministry of Interior. Then, the NESDB in
the end of 2015. Totally, it covers a cooperation with the BOI and related
combination of 36 sub-districts or 10 agencies are tasked to coordinate in
districts in 5 border provinces with a total designing detailed investment targets in
land area of 2,932 Km2. Recently, the the pilots SBEZs. Therefore, 4 different
Royal Thai Government has approved the sub-committees are formed at national
second phase of SBEZs since March 16, level. These are: (1) Sub-Committee on
2015, covering 5 provinces in a Identifying Physical Boundary of SBEZs;
combination of 16 districts or 63 sub- (2) Sub-Committee on Designing
districts.
Investment Incentives, Boundary and One
Stop Service Center; (3) Sub-Committee
on Infrastructure and Customs House; and
(4) Sub-Committee on One Stop Service
on Labor, Public Health and National
Security. An Act on Development of
Special Economic Zones is being drafted
and will take effect by 2016. The
Industrial Estate Authority of Thailand
has been tasked as implementing agency
35
Major Features
Policy 2:
International Trade
and Cross-Border
Trade Policies
Policy 3: Customs
Facilitation Policy
Customs
facilitation
through
establishment of National Single
Window helps increase intensity of
cross-border trade flows.
Policy 4: Border
Investment and
Industrial
Development Policies
36
Major Policies
36
Major Policies
Major Features
Provides
national
railways
linking
Bangkok metropolis and regional growth
centers and border provinces in order to
connect with neighboring countries. It also
aims to promote cross-border land
transport networks and efficient logistics
systems.
Policy 6: Labor,
Public Health and
National Security
Policies
Relax
cross-border
movement
of
immigrant labor within specified SBEZs.
One Stop Service Centers for Immigrant
Labor have been set up at the pilot
SBEZs. An Agreement between Thailand
and Cambodia on Using Border Passes
for Requesting Work Permits at the
specified SBEZs has been put in place.
37
Policy 5: National
and Cross-Border
Transport and
Logistics Policies
37
Major Policies
Indirect Policies
(Implicit Policies)
Policy 1: Tourism
and Visa Policies
Major Features
38
Policy 2:
International
Relations, Regional
Cooperation and
Official Development
Assistance Policies
38
4.2 Detailed Policy Analysis for Upholding Development of Special Border Economic
Zones
SBEZ policies in Thailand are currently advancing towards rapid implementation of pilot
locations. The Prayuth Government has firmly committed in formulating favorably
integrated policies, as well as accelerating the implementation process. As a result, analysis
of actual integrated policies for upholding special border economic zone development is
undertaken employing qualitative analysis. It can be broadly categorized into 2 major
groups of policies, which are direct and indirect policies as follows:
4.2.1 Direct Policies or Explicit Policies intend to directly lay down strong foundation for
supporting development of pilot SBEZs. Features and progresses of these integrated
policies are as follows:
1) Special Border Economic Zone Development Policies: It serves as core national
policy in driving SBEZ development. At present, the Prayuth Administration is keenly
expediting implementation of 10 SBEZs across Thailand dividing it into 2 phases. It aims
at attracting 20% more investments into these border regions, as well as being a part of
preparation plan for entry into ASEAN Community by the end of 2015. Therefore, on
January 19, 2015, the Prayuth Government approves 5 designated pilot SBEZs along with
major infrastructure development plan and associated private investment incentives. The
Royal Thai Government guides to realize early tangible progress by the end of 2015.
Totally, it covers 5 border provinces in 10 districts or 36 sub-districts with a total land area
of 2,932 Km2. These consist of:
(1) Tak Special Border Economic Zone covering Maesod, Pobpra and Maeramad districts
of Tak province with a total land area of 1,419 Km2;
(2) Mukdahan Special Border Economic Zone comprising of Muang Mukdahan, Wanyai
and Dontan districts in Mukdahan province with a total land area of 578.50 Km2;
(3) Sakaeo Special Border Economic Zone encompassing Aranyaprathet and
Wattananakhon districts in Sakaeo province with a total land area of 332 Km2;
(4) Trat Special Border Economic Zone covering Klong Yai district in Trat province with a
total land area of 50.20 Km2; and
(5) Songkhla Special Border Economic Zone including Sadao district in Songkhla province
with a total land area of 552.30 Km2.
Recently, the Royal Thai Government has approved the second phase of SBEZs on March
16, 2015 covering 5 provinces in 16 districts or 63 sub-districts. These are:
(1) Nongkhai Special Border Economic Zone encompassing 5 districts or a combination of
22 sub-districts namely, Muang Nongkhai, Srakrai, Ponpisai, Thabor and Srichiangmai
districts of Nongkhai province with a total land area of 144.78 Km2;
(2) Nakhon Panom Special Border Economic Zone including 2 districts (or a combination
of 13 sub-districts), namely, Muang Nakhon Panom and Tha-Uthain districts of Nakhon
Panom province;
(3) Chiang Rai Special Border Economic Zone involving 3 districts (or a combination of
21 sub-districts) namely, Maesai, Chiangsaen and Chiang Khong districts of Chiang Rai
province;
(4) Kanchanaburi Special Border Economic Zone covering Muang Kanchanaburi
District with a combination of 2 sub-districts in Kanchanaburi province with a total land
area of 260.78 Km2; and
(5) Narathiwat Special Border Economic Zone comprising 5 districts (or a combination of
39
5 sub-districts), namely, Sungai Kolok, Takbai, Wang, Yi-Ngo and Muang Narathiwat
districts in Narathiwat province with a total land area of 209 Km2.
The Royal Thai Government also set up a mechanism to run the SBEZs by assigning 4
main organizations to oversee implementation process comprising of the Office of the
National Economic and Social Development Board as a secretariat office of the National
Special Border Economic Zone Development Policy Board, Office of Board of Investment,
Ministry of Foreign Affairs and Ministry of Interior. Then, the Office of the National
Economic and Social Development Board in cooperation with Office of Board of
Investment and related agencies are tasked to coordinate in designing detailed investment
targets in the pilot SBEZs so that prospective investors can propose investment projects as
soon as possible. Furthermore, four different sub-committees are formed at national level
which are:
1) Sub-Committee on Identifying Physical Boundary of Special Border Economic
Zones chaired by Ministry of Interior. Its task is to consider target provincial proposals for
establishing SBEZs along with public land acquisition for further private lease. This is to
solve problem on increasing land price arising from widespread local land speculation;
2) Sub-Committee on Investment Incentives, Boundary and One Stop Service Center
on Investment, chaired by Permanent Secretary of Finance together with Office of Board
of Investment, Office of Council of State, National Security Council, Department of
Forestry, Office of SMEs Promotion and concerned provinces, local organizations and
private sector;
3) Sub-Committee on Infrastructure and Customs House comprising of 6
organizations, namely, Ministry of Transport (Department of Highways, Department of
Aviation and Marine Department), Ministry of Foreign Affairs, Ministry of Agriculture
and Cooperatives, Department of Customs, Office of Thailand Immigration and Industrial
Estate Authority of Thailand;
4) Sub-Committee on One Stop Service on Labor, Public Health and National
Security consisting of 10 organizations, namely, Ministry of Foreign Affairs, Ministry of
Interior, Ministry of Public Health, Department of Employment, Department of Skill
Development, Office of Thailand Immigration, Office of Social Security, Commission of
Vocational Education, Industrial Federation of Thailand and Thai Chamber of Commerce.
To facilitate rapid implementation of the 5 pilot SBEZs at provincial level, a study is being
done to set up a Special Border Economic Zone Administration Sub-Committee in each
pilot location. The Industrial Estate Authority of Thailand has been tasked as implementing
agency of the SBEZs. Moreover, the Royal Thai Government approved an infrastructure
and customs house development plan of the pilot SBEZs during the year 2015-2020 with
the amount of 98,571 million Baht for a total of 185 projects for specific undertakings as
follows:
Tak SBEZ - construction of the second Moei river bridge, Tak-Mae Sod
highway, improvement of Mae Sod airport, new customs house and immigration offices,
Mae Sod Industrial Estate and Huei Mae Sod reservoir, etc.;
Mukdahan SBEZ building of provincial highway, border logistics center,
residential area of customs officials, Mukdahan Industrial Estate and pumping station
utilizing electricity, etc.;
Trad SBEZ - development of Klongyai Port, border logistics center, customs house
40
play important role for fast track implementation of SBEZs plan. In addition, the
Department of Customs has provided additional investment incentives for establishment in
both free zone and bonded warehouse as follows:
Exemption from import tax for machinery;
Exemption from import tax for raw materials to be manufactured for export;
Exemption from export tax;
Exemption from disposal tax for materials;
Exemption from value-added tax for raw materials to be manufactured for export;
Exemption from value-added tax for import and export commodities; and
Unlimited time for storage of goods in free zone, whereas, storage of goods in
bonded warehouse is allowed only for maximum of 2 years.
In relation to prospective industries in the pilot SBEZs, the Board of Investment prioritizes
specific target productions consisting of 13 major industries covering 61 business activities
as follows:
Agro-industry, fishery and related businesses;
Manufacturing of ceramics product;
Manufacturing of textile, clothing and leather;
Manufacturing of furniture;
Manufacturing of gems and jewelry;
Manufacturing of medical devices;
Manufacturing of automotive, machinery and parts;
Manufacturing of electronics and electrical appliances;
Manufacturing of plastics;
Pharmaceuticals production;
Logistics businesses;
Industrial zones or industrial estates; and
Businesses that support tourism.
Regarding specific target industry in the 5 pilot SBEZs, the Board of Investment has
announced eligible industries and businesses as follows:
Tak Special Border Economic Zone consists of agro-industry, textile and apparel,
wood and wood furniture, and gems and jewelry. It will link with Myawaddy
Border Economic Zone in Kayin State of Myanmar;
Mukdahan Special Border Economic Zone comprises electronics, warehouse,
wholesale, logistics and tourism. It will connect with Savan Seno Special Border
Economic Zone in Savannakhet province of Lao PDR;
Sakaeo Special Border Economic Zone entails retail and wholesale, agro-processed
industry, warehouse and logistics. It will link with Poipet O'neang Special Border
Economic Zone in Banteay Meanchey province of Cambodia;
Trad Special Border Economic Zone involves eco-tourism, duty free cross-border
trade, multi-modal transport, warehouse and logistics. It will connect with Koh
Kong Special Economic Zone in Koh Kong province of Cambodia; and
Songkhla Special Border Economic Zone consists of extended area of an industrial
estate for export, natural rubber processing industry, seafood and halal food. It will
cooperate with heavy industrial zone, rubber and halal industry in bordering Kedah
state of Malaysia.
44
As of early August, 2016, there were 39 private investment projects that sought approval
from the Board of Investment with capital amount of 7,200 million Baht in 8 Special
Border Economic Zones comprising of Sakaeo, Tak, Trad, Songkhla, Mukdahan,
Nongkhai, Chiang Rai and Kanchanaburi. Out of these, there were 21 projects amounting
to 3,798 million Baht to be specifically invested in Tak Special Border Economic Zone.
Likewise, a total of 75 local, regional and international investors expressed strong interest
to make real investment in Nakhon Phanom Special Border Economic Zone.
5) Labor, Public Health and National Security Policies
Relax cross-border movement of immigrant labor within specified SBEZs is currently
under implementation. An Agreement between Thailand and Cambodia on Using Border
Passes for Requesting Work Permits at the specified SBEZs has been put in place. The
border pass will be valid for 30 days. Meanwhile, negotiations of such agreement between
Thailand, Lao PDR and Myanmar are in progress. One Stop Service Centers for immigrant
labor have been set up at the pilot SBEZs. Its function is to facilitate permission of
immigrant labor entering the country along with arrangement of medical check-up, medical
insurance and labor protection. Besides these, it will also formulate a skill development
plan to support both Thai nationals residing along the border areas and immigrant labor
working within the SBEZs in response to the training needs of private sector. Provision of
services on public health, education and public safety are in the planning stage. Concerning
national security, urgent matters which should be taken into account include border
demarcation, monitoring of immigrant labor and illegal immigrant, natural resources
management, and preparation of knowledgeable border officials and necessary supporting
equipments, etc.
6) National and Cross-Border Transport and Logistics Policies
Additional national railways linking Bangkok with key border provinces are being
planned. The major routes to be jointly invested with Japan are between Bangkok and
Chiangmai province and between Tak province and Mukdahan province. In addition,
railways linking with neighboring countries are being studied, either between
Kanchanaburi province and Bangkok; Bangkok-Chacheongsao province-Aranyaprathet
district of Sakaeo province and Bangkok-Chacheongsao province-Lamchabang Deep
Seaport. Likewise, other major dual track routes, both between Bangkok and Kangkoi (in
Saraburi province) and between Kangkoi and Maptaphut Deep Seaport, are under planning
process. Also, highspeed rails both between Bangkok and Nakhon Ratchasima province
and between Nakhon Ratchasima province and Nongkhai province are under planning
process. Furthermore, improvement of cross-border transport networks (e.g., international
highways, Mekong river bridges and river ports and logistics systems) linking with
neighboring countries is being done. This can facilitate transportation services, as well as
reduce logistics costs. In addition, this utilizes both GMS and ASEAN connectivity
towards promoting new production platforms with special emphasis on development of
provinces and clustering provinces along major economic corridors. Moreover, it supports
wider transnational connectivity both within ASEAN and Asian Highway Networks.
4.2.2 Indirect Policies or Implicit Policies aim to indirectly sustain development of
SBEZs. These include:
1) Tourism and Visa Policies
Thailand is strategically positioned as tourism gateway to Asia. Thailand also implements
regional tourism cooperation schemes both under GMS and ACMECS. ACMECS single
45
national and sectoral development progress, which can be classified into 4 distinct periods.
Each period is characterized by specific spatial development advancement. Currently, it is
under the fourth period (2002-2015), shifting towards upholding rural-urban relations and
development of special border economic zones (SBEZs) along the Greater Mekong
Economic Corridors in order to grasp the potential of proliferating regional cooperation
and integration programs, particularly for the Ayeyawady-Chao Phraya-Mekong Economic
Cooperation Strategy (ACMECS), the Greater Mekong Sub-region Economic Cooperation
Program and the ASEAN Economic Community as integral part of the ASEAN
Community. Development of SBEZs in Thailand is intermittent due to political
discontinuity. The Thaksin Administration initially announced to promote the first SBEZs
in both Chiang Rai and Tak provinces since 2003. However, it encountered severe
resistance from both local authorities and general public who are aware of being
profoundly displaced from their local administration function by the new local authorities
under the proposed special border economic zone law. This subsequently generated wide
criticism on pros and cons of the SBEZ within the Thai society. Coupled with political
discontinuity, the initiative to implement these two pilot SBEZs are consequently sluggish
for almost 8 years.
As Thailand approached full entry into the ASEAN Community by the end of 2015, the
Abhisit Administration reapproved on October 19, 2010 to develop Maesod district in Tak
province as a pilot special border economic zone. On March 22, 2011, a total budget of
14.04 million Baht was then allocated to carry out a research for the formulation of
development plan of Maesod Special Border Economic Zone. In 2013, the Yingluck
Administration renewed its support for the scheme by setting up a mechanism so called
Special Border Economic Zone Development Policy Board. Subsequently, a strategic plan
for promoting special border economic zones has been formulated in 2014 covering 5
regions across the country. This consists of: 1) Northern border region comprising of
Maesai, Chaingsaen and Chaingkhong districts in Chiang Rai province and Tak province;
2) Northeastern border region consisting of Mukdahan, Nakhon Phanom and Nongkhai
provinces; 3) Eastern border region representing Sakaeo and Trad provinces; 4) Western
border region comprising of Kanchanaburi province; and 5) Southern border region
including Sadao district of Songkhla province and Narathiwat province.
Presently, the Prayuth Administration promptly carries on hastening the implementation
process of these 10 SBEZs through favorably integrated development policies. These are:
(1) Direct policies or explicit policies consisting of special border economic zone
development policies, international trade and cross-border trade policies, customs
facilitation policy, border investment and industrial development policies, labor, public
health and national security policies, national and cross-border transport and logistics
policies; and (2) Indirect policies aiming to indirectly sustain development of SBEZs,
including tourism and visa policies and international relations, regional cooperation and
official development assistance policies. These integrated policies to some extent attracted
keen interest of private investors to make real investments in the designated SBEZs.
Nevertheless, there is a slight policy gap on labor cooperation policy with bordering
countries, which needs to be aligned to ensure effective implementation of the SBEZs.
According to the above analysis of relatedly existent and ongoing policies, the hypothesis
stating national and regional level policies and strategies are vital for border economic
zones in order to boost and catalyze respective national and regional development is
therefore supported. It is shown that committed political substantiation is crucial to drive
47
development of special border economic zones. It is also apparent that it has taken decades
to gradually evolve from general regional development policies towards currently
integrated special border economic zone development policies influencing the dynamic
regionalization and national spatial development.
48
CHAPTER 5
PROFILES OF THE CROSS-BORDER REGIONS
AND LOCAL BORDER ENTREPRENEURS
This chapter presents profiles of cross-border study locations between Thailand and
neighboring countries. It also provides insight into how different types of local border
trader and border industrial developer respondents evolve towards border
entrepreneurships.
Section A: Profiles of the Study Location
The study areas consist of 3 cross-border regions. The common and region-specific
features of each study location are as follows:
Cross-Border Region 1: Aranyaprathet District of Sakaeo Province in Thailand
bordering with OChrov District of Bantay Meanchey Province in Cambodia
5.1 Aranyaprathet District of Sakaeo Province in Thailand
Sakaeo province is located on a plateau in the eastern region of Thailand. It has a total land
area of 7,195.43 Km2, which is suitable for cultivating farm crops and animal rearing. By
September 30, 2012, Sakaeo province had a total population of 547,751 with 182,448
households. It is divided into 9 districts, in which 4 districts share common border with
Banteay Meanchey province of Cambodia. Among others, Aranyaprathet district, which is
located at the main artery road, is the most strategic land gateway along the Southern
Economic Corridor linking the cities of Bangkok (Thailand), Phnom Penh (Cambodia), Ho
Chi Minh City and Van Tau (Vietnam). The district is far from the capital city of Bangkok
at 255 Km. Aranyaprathet district has a total area at 821.26 Km2. In 2009, it had a total
population of 85,387 with density of 103.97 persons/Km2. In terms of administration, it is
further divided into 13 sub-districts and 114 villages. Aranyaprathet district also hosts the
site of Rong Kleua border market, which is the largest of such kind in Thailand. It is also
the largest second-hand clothes market in Asia. In 2012, the urbanization rate in
Aranyaprathet district was rather low at 20.20%. Currently, the urbanization rate is
increasing due to rapid local border economic growth and the presence of large scale
border retail establishments.
5.2 OChrov District of Banteay Meanchey Province in Cambodia
Banteay Meanchey province, the 13th largest province, is located in the far northwest of
Cambodia. It is mostly covered by extensive lowlands with a few uplands to the north and
east. It shares an international land border with Thailand to the west. The total land area is
6,679 Km2. In 2008, it had a total population of 678,033 and ranked the 10th largest in the
nation with density of 100 persons/Km2. During the Cambodian Civil Wars in the 1970s
and 1980s, Banteay Meanchey Province was in the frontlines of much of fighting and as a
result, it is one of the three most heavily mined provinces in Cambodia along with Pailin
and Battambang. Banteay Meanchey is also one of the nine provinces that is part of the
Tonle Sap Biosphere Reserve.
The province is divided into 8 districts. Out of 3 districts sharing common border with
Sakaeo province of Thailand, OChrov district is the most strategic location as it is located
49
along the Southern Economic Corridor linking cities of Bangkok (Thailand), Phnom Penh
(Cambodia), Ho Chi Minh city and Van Tau (Vietnam). The district consists of 8
communes and 75 villages. In 2008, the district had a total population of 100,590. Poipet is
the main city and home to 8 border casinos aiming to attract Thai visitors. Altogether, it
generates both local and international employments of 6,011 jobs including 599 Thai
skilled workers. The district is far from its capital city of Phnom Penh, approximately
408 Km. The Poipet ONeang Special Economic Zone (POSEZ) is being developed in
Poipet city on more than 500 hectares of land. POSEZ will contain an industrial zone,
commercial zone, dry port and residential zone. The industrial zone is divided into 4
phases, and construction is expected to be completed in 2018. The target investors are from
China, Taiwan, Hong Kong, Korea, Thailand, Japan and local Cambodian investors. In
2012, the urbanization rate in OChrov district was rather high at 45.24%.
Cross-Border Region 2: Muang Mukdahan District in Mukdahan Province of
Thailand bordering with Kaysone Phomvihane District of Savannakhet Province in
Lao PDR
5.3 Muang Mukdahan District of Mukdahan Province in Thailand
Mukdahan province is located in the northeastern region of Thailand. Approximate 20% of
the provincial area is lowland region. It shares common Mekong river border with
Savannakhet Province of Lao PDR with a distance of 72 km. The province is divided into
7 districts. These districts are further subdivided into 53 sub-districts and 493 villages. It
has a total land area of 4,339.8 Km2. In 2011, it had a total population of 340,581 with
density of 78 persons/Km2. In 2006, the Second Thai-Lao Friendship Bridge from
Mukdahan province to Savannakhet province of Lao PDR was opened. The bridge is 1,600
meters long and 12 meters wide, with two traffic lanes.
Out of 3 border districts, Muang Mukdahan district is the most strategic location as it is
located at a border node along the East-West Economic Corridor linking cities of
Myawaddy (Myanmar), Maesod (Thailand), Mukdahan (Thailand), Savannakhet (Lao
PDR), Dansavanh (Lao PDR) and Lao Bao (Vietnam). It is far from its capital city of
Bangkok at 647 Km. It has a total land area of 1,235.07 Km2. In 2009, it had a total
population of 129,162, excluding 2,069 Vietnamese with density of 104.57 persons/Km2 or
37.92% of provincial population. In terms of administration, it is divided into 13 Tambon
(sub-district) Administration Organizations and 143 villages. Muang Mukdahan district
also hosts site of Indochina market, which is a center for distribution of various Indochina
products. It is also a popular local tourist attraction. In 2012, the urbanization rate in
Muang Mukdahan district is rather high at 42.61%. Currently, it is increasing due to the
large scale border retail establishments.
5.4 Kaysone Phomvihane District of Savannakhet Province in Lao PDR
Savannakhet is the largest province in Lao PDR, covering an area of 21,774 Km2. It is
located in the southern part of the country sharing common Mekong river border with both
Nakhon Phanom and Mukdahan provinces of Thailand to the west. The province is
strategically located along the East-West Economic Corridor. Savannakhet province is an
important industrial center in the central region, and is one of the main tobacco producing
areas of Lao PDR. It has numerous natural resources. Sepon is the largest mine in Lao
50
PDR, with reserves of copper and gold. In 2005, it had a total population of 825,879. The
province is divided into 15 districts.
Among others, Kaysone Phomvihane district, a capital city of Savannakhet province, is
also Lao PDRs second most notable city after the capital Vientiane. It has a total land area
of 521 Km2 and far from its capital city of Vientiane at 469 Km. In 2008, it had a total
population of 117,821 with density of 226 persons/ Km2. The district is divided into 67
villages. It forms an important trading area between Thailand and Vietnam. Like all
Laotian cities, Kaysone Phomvihane has a mixed population of Laotian, Thai, Vietnamese
and Chinese, as well as ethnic minority groups from various parts of Lao PDR. Since 2003,
the Lao PDR government has established the Savan-Seno Special Economic Zone in
Savannakhet province on the land area of 954 hectares with capital investment amount of
74 million US$. It consists of 4 development zones, of which 3 zones are situated in
Kaysone Phomvihane district, namely, Zone A (Savan city), Zone B (Logistics park) and
Zone C (Resettlement). The district also hosts a large Savan Vegas casino aiming to attract
Thai visitors with both local and international employments of 1,400 jobs including 1,200
skilled foreign workers. In 2012, the urbanization rate in Kaysone Phomvihane district was
noticeably high at 61%.
Cross-Border Region 3: Maesod District of Tak Province in Thailand bordering with
Myawaddy District of Kayin State in Myanmar
5.5 Maesod District of Tak Province in Thailand
Tak province is located in upper-northern region of Thailand sharing common river border
with Kayin state of Myanmar. It covers an area of 16,406.65 Km2, the 4th largest province
across Thailand. Its geographical setting is mostly forest and mountainous areas
particularly on the west part of the province. In 2012, it had a total population of 526,045
with density of 32.06 persons/Km2, the second least dense population in Thailand. Tak
province consists of 9 districts with 5 districts sharing common border with Myanmar.
Among others, Maesod district, the most vibrant border city adjacent to Myanmar, is
located at the west section of East-West Economic Corridor. It covers an area of 1,986
Km2 or 12.11% of total provincial area. It is situated in the valley between Thanon
Thongchai mountain range in Thailand and a mountain in adjacent Myanmar. Maesod
district is far from its provincial city center at 86 km and is away from its capital city of
Bangkok at 493 Km.
In 2009, it has a total population of 119,125 with density of 59.97 persons/Km2. It has
international character as inhabitants comprise a mixed of local residents, highlanders and
international NGOs. Maesod city is also home to wholesale and retail gemstones, which
mainly originated from Myanmar. It is divided into 10 sub-districts (Tambon) with 88
villages. In terms of local urban administration, there are 4 municipalities, namely,
Maesod, Maegu, Thasailuad and Maetao. Particularly, Maesod municipality alone has an
area of 27.2 Km2 with a total population of 35,124 or 29.48% of the whole population of
Maesod district. The rest of the 6 Tambon Administration Organizations are administered
in rural areas. In 2010, Maesod district also accommodated around 80,000 immigrant
Myanmar workers. Currently, it is increasing due to the large scale border retail
establishments. There are 22 privately operated border warehouses which are supervised
by Maesod Customs House. In 2012, the urbanization rate in Maesod district was rather
high at 40.25%.
51
education. This means having higher educational attainment could better equip them to
adapt to changing rules and regulations on cross-border trading. For comparative analysis,
respondents in Aranyaprathet district have higher educational levels than those
counterparts in OChrov district, as less than half of these respondents obtained vocational
certificate. Less than half of Aranyaprathet district respondents attained higher education
divided into almost a quarter earning master degree and almost a fifth holding bachelor
degree. Few of respondents finished either primary school or higher secondary school and
Table 5.1 below exhibits educational levels of respondents across three cross-border
regions.
Table 5.1 Educational levels of respondents
Educational level
Cross-Border Region 1
Tha
Cam
F
%
F
%
1. Illiterate
1
4.5
0
0
2. Primary school
1
4.5
1
6.6
3. Lower secondary
0
0
2
13.3
school
4. Higher
1
4.5
8
52.8
secondary school
5. Vocational
10
45.4
0
0
certificate
6. Bachelor degree
4
18.1
4
26.4
7. Masters degree
5
22.7
0
0
Total
22
100
15
100
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
1
3.3
2
6.6
1
3.3
3
10
1
3.3
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
1.8
3
10
11 20.3
4
13.2
0
0
7
23.1
26.7
10.8
10
33.3
17
56.6
23.3
16.2
16.5
5
3
30
16.5
10
100
11
1
30
36.7
3.3
100
27
0
54
48.6
0
100
1
0
30
3.3
0
100
some are illiterate. While greater than half of respondents in OChrov district finished
higher secondary school, more than a quarter of them obtained bachelor degree, more than
a tenth finished lower secondary school, and one respondent completed primary school.
Likewise, respondents in Muang Mukdahan district have slightly higher educational level
than counterparts in Kaysone Phomvihane district, as more than half of them obtained
vocational certificate. Less than a fifth of Muang Mukdahan district respondents gained
bachelor degree, a tenth finished either lower secondary school or master degree, and few
of them finished primary school. Also, more than a third of respondents in Kaysone
Phomvihane district earned bachelor degree, more than a quarter finished higher secondary
school, and almost a quarter hold vocational certificate. There are very few respondents
who finished either primary school, lower secondary school, or master degree while one
respondent is illiterate.
Similarly, respondents in Maesod district attained higher educational levels than those
counterparts in Myawaddy district. Almost half of the respondents in Maesod district
obtained bachelor degree, a fifth finished primary school level, almost a third gained
vocational certificate, a tenth finished higher secondary school level, and one respondent is
illiterate. On the other hand, a third of respondents in Myawaddy district finished higher
54
secondary school level, almost a quarter finished lower secondary school level, less than a
fifth obtained vocational certificate, and a tenth either finished primary school or illiterate.
Only a very small proportion of respondents earned bachelor degree.
3) Nativity
A range of 50% to 76.60% of the respondents in 5 border districts are native local
residents, except in OChrov district, where 93.40% of respondents are non-native local
residents. Regarding non-native local dwellers, the length of residency across the crossTable 5.2 below presents nativity of respondents across three cross-border regions.
Table 5.2 Nativity of respondents
Nativity
Cross-Border Region 1
Tha
Cam
F
%
F
%
Native local
14
63.6
1
6.6
resident
10 years
4
18.1
9
60
10-20 years
3
13.6
5
33.3
20-30 years
1
4.5
1
6.6
>30 years
0
0
0
0
Total
22
100
15
100
Mean
12
11
Standard
7.1
6.0
deviation
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
23
76.6
23
76.6
Cross-Border Region 3
Tha
Mya
F
%
F
%
28
51.1
15
50
4
3
0
0
30
10
5.1
8
11
2
5
54
17
11
13.3
10
0
0
100
4
2
1
0
30
11
7.5
13.3
6.6
3.3
0
100
14.9
20.4
3.7
9.3
100
9
2
4
0
30
12
9
30
6.7
13.2
0
100
the respondents in 4 border districts are married. For comparative analysis, most of
respondents in both Aranyaprathet district of Thailand and OChrov district of Cambodia
are married while a tenth of respondents in Aranyaprathet district are still single. A few of
respondents are divorced while very few in OChrov district are single. Also, almost 3
quarters of respondents in Muang Mukdahan district of Thailand are married and slightly
more than a quarter are single. Similarly, 3 fifth of respondents in Maesod district of
Thailand are married, a third are single and one respondent is divorced.
2) Educational attainments
Table 5.3 below presents educational levels of respondents across three cross-border regions.
Table 5.3 Educational levels of respondents
Educational level
Cross-Border Region 1
Tha
Cam
F
%
F
%
1. Illiterate
1
3.3
0
0
2. Primary school
14
46.6
5
33.3
3. Lower secondary
0
0
6
40
school
4. Higher
7
23.3
0
0
secondary school
5. Vocational
1
3.3
3
20
certificate
6. Bachelor degree
6
20
1
6.7
7. Master degree
1
3.3
0
0
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
0
0
6
20
4
12.1
8
26.6
11
33.3
2
6.6
9.9
9.1
10
1
33
3.3
14
1
42.4
3.3
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
3
1
3.3
2
6.1
12
40
9
27.3
16 53.
3
0
0
1
3.3
1
3
0
0
15
45.5
0
5
15.2
0
0
0
33
100
30 100
Total
30
100
15
100
30
100
30
100
Source: Field survey during 2009-2012.
Remarks: Thailand (Tha)-Cambodia (Cam): Aranyaprathet District/ OChrov District; Thailand
(Tha)-Lao PDR (Lao): Muang Mukdahan District/ Kaysone Phomvihane district;
Thailand (Tha)-Myanmar (Mya): Maesod District/ Myawaddy District
F means for frequency.
Thai respondents have higher educational attainments than those counterparts in bordering
districts, as 20% to 45.50 % of these respondents obtained bachelor degree. In contrast,
27.30% to 53.30% of respondents across bordering districts finished lower secondary
schoo. For comparative analysis, more than 2 fifth of respondents in Aranyaprathet district
finished primary school and almost a fifth either finished higher secondary school or
earned bachelor degree. There are very few of respondents who gained either vocational
certificate or master degree and others are illiterate. Likewise, 2 fifth of respondents in
OChrov district finished lower secondary school, a third finished primary school, 2 fifth
hold vocational certificate and one respondent gained a bachelor degree.
Similarly, respondents in both Muang Mukdahan and Kaysone Phomvihane districts have
rather comparable educational levels as greater than 2 fifth of respondents in Kaysone
Phomvihane, and almost a third of respondents in Muang Mukdahan districts hold bachelor
degree. A tenth of respondents in both districts gained vocational certificate and only a
small proportion of respondents in both districts obtained master degree. A fifth of
respondents in Muang Mukdahan district alone finished either primary school or lower
secondary school and few finished higher secondary school. Also, a third of respondents in
Kaysone Phomvihane district completed lower secondary school and more than a tenth of
57
373,334
501
88,001
238
153,334
399
262,834
442
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
0
0
24
73
7
23.3
6
18
13
43.3
0
0
0
0
3
9
6
20
0
0
0
0
0
0
4
13.3
30
100
30
100
202,334
334
254,000
473
higher than 380,000 Baht per month. On the contrary, respondents in Kaysone Phomvihane
district of Lao PDR gave rather realistic figures as half of them generate monthly income
of 30,000 Baht to 100,000 Baht per month. A third of respondents earn 100,000 Baht to
170,000 Baht per month, few make either 240,000 Baht to 310,000 Baht per month or
higher than 380,000 Baht per month, and one respondent secures 30,000 Baht per month.
Correspondingly, almost 3 quarters of respondents in Maesod district of Thailand generates
monthly income of 30,000 Baht to 100,000 Baht per month, almost a fifth earn 100,000
Baht to 170,000 Baht per month, and almost a tenth generate 240,000 Baht to 310,000
Baht per month. Also, more than 2 fifth of respondents in Myawaddy district of Myanmar
generate monthly income of 100,000 Baht to 170,000 Baht per month, almost a quarter
make 30,000 Baht to 100,000 Baht per month, a fifth earn 240,000 Baht to 310,000 Baht
per month, and more than a tenth of respondents secure higher than 380,000 Baht per
month. It should be noted that a broad range of standard deviations shown in the table
implies that some respondents may have under-reported their monthly income.
4) Nativity
Table 5.5 below presents nativity of respondents across three cross-border regions.
Table 5.5 Nativity of respondents
Nativity
Cross-Border Region 1
Tha
Cam
F
%
F
%
Native local
7
23.3
2
13.3
resident
<10 years
10
33.3
5
33.3
10-20 years
4
13.3
7
46.6
20-30 years
3
10
1
6.6
>30 years
6
20
0
0
Total
30
100
15
100
Average
3.8
7
Standard
35
12
deviation
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
16
53.3
22
66.7
Cross-Border Region 3
Tha
Mya
F
%
F
%
16
48.5
6
20
8
6
0
0
30
6
9.6
10
7
0
0
33
5
10
26.7
20
0
0
100
8
2
1
0
30
11
6.6
24.3
6.1
3
0
100
30.4
21.2
0
0
100
15
9
0
0
30
5
10
50
30
0
0
100
Respondents in Kaysone Phomvihane district of Lao PDR have the highest number of local
native residents at 66.70%, followed by Muang Mukdahan district of Thailand at 53.30%.
On the contrary, respondents in 2 Thai border districts have higher number of local native
residents at 23.30% and 48.50% in Aranyaprathet and Maesod districts, respectively.
Meanwhile, respondents in 2 bordering districts have fewer local native residents at
13.30% and 20% in OChrov district of Cambodia and Myawaddy district of Myanmar,
respectively. The length of residency of non-native local residents across the cross-border
regions ranges from 4 years to 11 years. For comparative analysis of non-native local
residency, more than 3 quarters of respondents in Aranyaprathet district of Thailand and
more than 4 fifth of respondents in OChrov district of Cambodia are non-local native
residents, in which almost a third of respondents in Aranyaprathet district of Thailand live
in the district for less than 10 years. A fifth of respondents dwell in the district longer than
30 years, more than a tenth reside in the district for 10 years to 20 years, and a tenth settle
in the district for 20 years to 30 years. Likewise, less than half of respondents in OChrov
district reside in the district for 10 years to 20 years, a third live in the district for less than
10 years, and one respondent stays in the district for 20 years to 30 years.
59
Similarly, a third of respondents in Kaysone Phomvihane district of Lao PDR and less than
half of respondents in Muang Mukdahan district of Thailand are non-native local residents.
A quarter of respondents in Muang Mukdahan district reside in their city for less than 10
years and a fifth live in the city for 20 years to 30 years. Also, almost a quarter of
respondents in Kaysone Phomvihane district reside in the district for less than 10 years, a
few live in the district for 10 years to 20 years, and one respondent dwells in the district for
20 years to 30 years. Correspondingly, slightly more than half of respondents in Maesod
district of Thailand and 4 fifth of respondents in Myawaddy district of Myanmar are nonnative local residents. Almost a third of respondents in Maesod district dwell in the city for
less than 10 years and a fifth live in the city for 10 years to 20 years. Likewise, half of
respondents in Myawaddy district of Myanmar reside in the city for less than 10 years and
almost a third of respondents live in the city for 10 years to 20 years.
5.9 Local Border Retailers
Border retail is the sale of goods from individuals or businesses to the customers. Retailers
are part of the border supply chains. They sell smaller quantities of goods to the consumers
for a profit. Border retailing can be done in either fixed locations like stores, markets or on
streets. The profiles of border retailers are as follows:
1) Background of the Border Retailer Respondents
With respect to gender, female retailers (60% to 82.5% across the cross-border regions)
play important role in trading. Wth regard to race, a large number of people from bordering
cities perform retailing in adjacent Thai border cities. For instance, 91% of respondents in
Aranyaprathet district of Thailand are Cambodian nationals. Likewise, less than a tenth of
respondents in Maesod district are Burmese nationals. The rest of respondents in 4 border
districts are real nationals from their respective districs.
In relation to age, the average ages of retailers across Thai border districts are of older
working age ranging from 34 to 49 years old, while respondents across bordering districts
are younger, ranging from 31 to 37 years old. For comparative analysis, more than a third
of respondents in both Aranyaprathet district of Thailand and OChrov district of
Cambodia are younger than 30 years old. A third of respondents in Aranyaprathet district
of Thailand are 30 to 50 years old, a quarter are 50 to 60 years old, and one respondent
aged older than 60 years old. While almost half of respondents in OChrov district of
Cambodia are 30 to 50 years old, almost a tenth are 50 to 60 years old. Likewise, more
than 3 quarters of respondents in Muang Mukdahan district of Thailand are 50 to 60 years
old, almost a fifth are younger than 30 years old, and one respondent aged older than 60
years old. Also, almost 3 quarters of respondents in Kaysone Phomvihane district of Lao
PDR are 30 to 50 years old, less than a fifth are younger than 30 years old, and a tenth are
aged older than 60 years old. Correspondingly, more than 2 third of respondents in Maesod
district of Thailand are still in working ages of 50 to 60 years old, less than a fifth are
younger than 30 years old, a tenth are 30 to 50 years old, and a few of border retailers are
older than 60 years old. Also, more than 3 quarters of respondents in Myawaddy district of
Myanmar are 30 to 50 years old, a fifth are younger than 30 years old, and one respondent
aged 50 to 60 years old.
Regarding marital status, 72.90% to 100% of respondents across the cross-border regions
are already married. For comparative analysis, almost 3 quarters of respondents in
Aranyaprathet district of Thailand and more than 4 fifth of respondents in OChrov district
60
of Cambodia are married. A quarter of respondents in Aranyaprathet district are still single,
one respondent is divorced, while less than a fifth of respondents in OChrov district are
still single. Also, most of respondents in Kaysone Phomvihane district of Lao PDR and 3
quarters of respondents in Muang Mukdahan district of Thailand are married. More than a
third of respondents in Muang Mukdahan district are still single, a few are divorced, and
one respondent is widowed. Only a very small proportion of respondents in Kaysone
Phomvihane district are still single. Similarly, more than 4 fifth of respondents in Maesod
district of Thailand and all of respondents in Myawaddy district of Myanmar are already
married. While a tenth of respondents in Maesod district of Thailand are still single, a few
of respondents are divorced.
2) Educational levels
Table 5.6 belows exhibits educational levels of respondents across three cross-border
regions.
Table 5.6 Educational levels of respondents
Educational level
Cross-Border Region 1
Tha
Cam
F
%
F
%
6
12.5
0
0
7
14.5
12
38.7
33
68.7
10
32.3
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
1
1.8
0
0
12
21.1
4
13.3
12
21.1
4
13.3
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
3.3
6
20
14
46.6
19
63.3
7
23.3
5
16.7
1. Illiterate
2. Primary school
3. Lower secondary
school
4. Higher
1
2
9
29
9
15.8
22
73.3
0
0
0
secondary school
5. Vocational
1
2
0
0
10
17.5
0
0
1
3.3
0
certificate
6. Bachelor degree
0
0
0
0
12
21.1
0
0
6
20
0
7. Master degree
0
0
0
0
1
1.8
0
0
0
0
0
Total
48
100
31
100
47
100
30
100
30
100
30
Source: Field survey during 2009-2012.
Remarks: Thailand (Tha)-Cambodia (Cam): Aranyaprathet District/ OChrov District; Thailand
(Tha)-Lao PDR (Lao): Muang Mukdaharn District/ Kaysone Phomvihane district;
Thailand (Tha)-Myanmar (Mya): Maesod District/ Myawaddy District
F stands for frequency.
Thai respondents across Thai border districts generally have higher educational attainments
than counterpart bordering districts. Ranging from 21.10% to 68.70% of Thai respondents
finished lower secondary school, while 13.30% to 63.30% of respondents across bordering
districts finished primary school. For comparative analysis, only a very small proportion of
Thai respondents in Aranyaprathet district graduated from either lower secondary school or
higher secondary school, earned vocational certificate, and even are illiterate. In
comparison, 2 third of Cambodian border retailer respondents in Aranyaprathet district
finished lower secondary school. Less than a fifth finished primary school and a tenth of
respondents are illiterate. While almost 2 fifth of respondents in OChrov district of
Cambodia finished primary school, almost a third completed lower secondary school, and
more than a quarter graduated from higher secondary school.
Likewise, slightly more than a fifth of respondents in Muang Mukdahan district finished
either primary school or lower secondary school, or earned a bachelor degree. Less than a
fifth of respondents either graduated from higher secondary school or earned vocational
61
0
0
0
0
100
certificate. One respondent holds a master degree and another is illiterate. Similarly, almost
3 quarters of respondents in Kaysone Phomvihane district of Lao PDR finished lower
secondary school and slightly more than a tenth of respondents completed either primary
school or lower secondary school.Correspondingly, less than half of respondents in
Maesod district of Thailand and more than 3 fifth of respondents in Myawaddy district
finished primary school. Almost a quarter of respondents in Maesod district of Thailand
including a Burmese national retailer completed lower secondary school and there are very
few who either received vocational certificate or are illiterate. While less than a fifth of
respondents in Myawaddy district of Myanmar completed lower secondary school, a fifth
of respondents are illiterate.
3) Monthly income of border retailers
Table 5.7 below presents monthly income of border retailers across three cross-border
regions.
Table 5.7 Monthly income of border retailers
Monthly income scale
Cross-Border Region 1
Tha
Cam
F
%
F
30,000 Baht
4
8.3
11
30,000-50,000 Baht
5
10.4
8
50,000-70,000 Baht
20
41.6
3
70,000-90,000 Baht
12
25
8
>90,000 Baht
7
14.5
1
Total
48
100
31
Mean (Baht)
65,730
45,484
Standard deviation
23,936
27,922
Source: Field survey during 2009-2012.
%
35.5
25.8
9.7
25.8
3.2
100
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
40
70.2
18
9
15.8
4
7
12.3
3
1
1.8
4
0
0
1
57
100
30
25,614
34,500
17,574
27,183
%
60
13.3
10
13.3
3.3
100
Cross-Border Region 3
Tha
Mya
F
%
F
19
63.3
20
6
20
8
2
6.6
2
1
3.3
0
2
6.6
0
30
100
30
31,167
24,667
26,067
14,430
Respondents across Thai border districts have quite higher average monthly income of
25,614 Baht, 31,167 Baht and 65,730 Baht in Muang Mukdahan, Maesod and
Aranyaprathet districts, respectively. On the other hand, respondents across the bordering
districts have lower average monthly income of 24,667 Baht, 34,500 Baht and 45,484 Baht
in Myawaddy, Kaysone Phomvihane and OChrov districts, respectively. The table shows
a broad variation of standard deviation, which means that the respondents might have
under-reported their monthly income. For comparative analysis, Thai border retailers in
Aranyaprathet district generate monthly income of 65,730 Baht which is higher than the
Cambodian national retailers. A few of Thai respondents in Aranyaprathet district of
Thailand generate income higher than 90,000 Baht per month. There are very few Thai
respondents who earn either 50,000 Baht to 70,000 Baht or 70,000 Baht to 90,000 Baht per
month. Likewise, 2 fifth of Cambodian border retailers in Aranyaprathet district of
Thailand generate monthly income of 50,000 Baht to 70,000 Baht per month. Almost a
quarter of respondents earn 70,000 Baht to 90,000 Baht per month, a tenth gain either less
than 30,000 Baht, or 30,000 Baht to 50,000 Baht or higher than 90,000 Baht per month. In
contrast, the monthly income of respondents in OChrov district of Cambodia is much
lower at 24,667 Baht. More than a third of respondents in OChrov district generate
income of less than 30,000 Baht per month and a quarter earn either 30,000 Baht to 50,000
Baht or 70,000 Baht to 90,000 Baht per month. Almost a tenth of respondents generate
50,000 Baht to 70,000 Baht per month and one respondent earns higher than 90,000 Baht
per month.
While the average monthly income of border retailers in Kaysone Phomvihane district of
Lao PDR is much higher at 34,500 Baht, the average monthly income of border retailers in
62
%
66.7
26.7
6.7
0
0
100
Muang Mukdahan district of Thailand is lower at 25,614 Baht. Less than 3 quarters of
respondents in Muang Mukdahan district of Thailand earn less than 30,000 Baht per month
and less than a fifth generate 30,000 Baht to 50,000 Baht per month. More than a tenth of
respondents gain 50,000 Baht to 70,000 Baht per month and one respondent receives
70,000 Baht to 90,000 Baht per month. In comparison, 3 fifth of respondents in Kaysone
Phomvihane district generate less than 30,000 Baht per month, more than a tenth earn
30,000 Baht to 50,000 Baht or 70,000 Baht to 90,000 Baht per month, a tenth gain 50,000
Baht to 70,000 Baht per month, and one respondent secures 90,000 Baht per month.
Correspondingly, the average monthly income of border retailers in Maesod district of
Thailand is higher at 31,167 Baht, whereas, the average monthly income of border retailers
in Myawaddy district is lower at 24,667 Baht. More than half of respondents in Maesod
district of Thailand, including 2 Burmese border retailers, receive monthly income less
than 30,000 Baht. A fifth of respondents generate 30,000 Baht to 50,000 Baht per month,
less than a tenth gain either 50,000 Baht to 70,000 Baht or higher than 90,000 Baht per
month, and a few acquire 70,000 Baht to 90,000 Baht per month. While 2 third of border
retailer respondents in Myawaddy district of Myanmar generate monthly income less than
30,000 Baht, a quarter earn 30,000 Baht to 50,000 Baht per month, and a few secure
50,000 Baht to 70,000 Baht per month. It should be noted that the broad range of standard
deviations shown in the table implies that some respondents may have under-reported their
monthly income.
4) Nativity
Table 5.8 below presents nativity of respondents across three cross-border regions.
Table 5.8 Nativity of respondents
Nativity
Cross-Border Region 1
Tha
Cam
F
%
F
%
Native local
3
6.25
1
3.3
resident
Cross-border
44
91.6
0
0
immigrant traders
<10 years
0
0
20
64.4
10-20 years
1
2
10
32.2
>20 years
0
0
0
0
Total
48
100
31
100
Mean
16
10
Standard
15
10
deviation
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
33
57.9
22
66.7
Cross-Border Region 3
Tha
Mya
F
%
F
%
7
23.3
6
20
11
11
2
57
12
13
19.3
19.3
3.6
100
8
2
1
33
8
11
24.3
6.1
3
100
10
7
6
30
14
16
33.3
23.3
20
100
14
10
0
30
10
11
46.7
33
0
100
More than half of respondents in Muang Mukdahan district of Thailand and 2 third of
respondents in Kaysone Phomvihane district of Lao PDR are truly native local residents,
whereas, most of respondents (76.70%, 80%, 93.75% and 96.70%) from the other 4 border
districts (Maesod, Myawaddy, Aranyaprathet and OChrov districts, respectively) are nonnative local residents. Regarding non-native local residents, respondents across Thai border
districts reside in their respective districts for 12 years, 14 years, and 16 years in Muang
Mukdahan, Maesod, and Aranyaprathet districts, respectively. Respondents in the
bordering districts live for shorter time of 8 years in Kaysone Phomvihane district of Lao
63
PDR to 10 years each in both OChrov district of Cambodia and Myawaddy district of
Myanmar.
For comparative analysis, there are very few respondents in both Aranyaprathet district of
Thailand and OChrov district of Cambodia who are native local-residents. Regarding nonlocal residents, 92% of respondents in Aranyaprathet district of Thailand are Cambodian
border retailers, who always cross the border on daily basis. Only a Thai respondent
resides in the district for 10 years to 20 years. On the contrary, almost 2 third of
respondents in OChrov district reside in the district for less than 10 years and almost a
third lived in the district for 10 years to 20 years. Also, almost a fifth of respondents in
Muang Mukdahan district resided in the district either for less than 10 years or for 10 years
to 20 years and a few live in the district longer than 20 years. Similarly, almost a quarter of
respondents in Kaysone Phomvihane district of Lao PDR reside in the district for less than
10 years, a few for 10 years to 20 years, and one respondent inhabits in the district for
more than 20 years.
However, 20% and 23.30% of respondents in both Myawaddy district of Myanmar and
Maesod district of Thailand, respectively, are native local residents. Regarding non-native
local residents, a third of respondents lived in Maesod district for less than 10 years, almost
a quarter stay in the district longer for 10 years to 20 years, and a fifth reside in the district
longer than 20 years. Also, almost half of respondents in Myawaddy district of Myanmar
stay in the district for less than 10 years and a third live in the district for 10 years to 20
years.
5.10 Local Border Industrial Developers
The background of border industrial developers is as follows:
Regarding gender, respondents across Thai border districts have more male industrial
developers: 62.30%, 70% and 75% in Maesod, Muang Mukdahan and Aranyaprathet
districts, respectively. Across the bordering districts, the number of male industrial
developers is slightly lower: 55.70%, 66.60% and 70% in Kaysone Phomvihane,
Myawaddy and OChrov districts, respectively. The rest of respondents across the crossborder regions are female industrial developers.
In terms of race, most of respondents are nationals from respective districs across the
cross-border regions. However, there is few cross-border industrial developers in 2 Thai
border districts of Muang Mukdahan and Maesod and in bordering Kaysone Phomvihane
district of Lao PDR. For comparative analysis, all of respondents in Aranyaprathet district
are Thai nationals. Likewise, most of respondents in Muang Mukdahan and Maesod
districts are Thai nationals, while one respondent in Muang Mukdahan district is a
Vietnamese national. A few of respondents in Maesod district are either Burmese or
Chinese entrepreneurs while all respondents in 2 bordering districts including OChrov and
Myawaddy districts are their respective Cambodian and Burmese nationals. Also, most of
respondents in Kaysone Phomvihane district are Laotian nationals, while a few of
respondents are Thai nationals, and one respondent is South Korean national.
64
prohibited in Thailand because of huge outflow of local and regional Thai tourists visiting
casinos in these bordering districts. On the contrary, there is a continuing huge influx of
immigrant labor from bordering districts into the counterpart Thai border regions.
5.11.2 Profiles of the Local Border Entrepreneurs
This section presents common and category-specific profiles of the respondents, which
mainly consists of border trader category including cross-border large scale traders, local
border wholesalers and retailers. It provides insight into how different types of local border
traders and industrial developer respondents evolve towards border entrepreneurships. The
specific feature for each type of respondent is described as follows:
1) Local Cross-Border Large Scale Traders
The local cross-border large scale traders play vital role in fostering closer regional
economic integration. Most respondents (54.40% to 76.70%) across the cross-border
regions are male traders. With regards to race, respondents across 5 border districts are
mostly their respective nationals, except in Maesod district where most of cross-border
trader respondents are Thai nationals. A few of the respondents are Burmese nationals. The
average age of respondents across the cross-border regions is 34 years to 45 years old.
Most respondents (59% to 100%) across the cross-border regions are married. Respondents
across Thai border districts have higher educational attainment than those counterparts in
bordering districts. Respondents (26.50% to 48.60%) across Thai border districts obtained
higher education, while 26.70% to 52.80% of respondents across the bordering districts
completed higher secondary school. This means having higher educational attainment
could better equip them to adapt to changing rules and regulations on cross-border trading.
Most respondents (50% to 76.60%) across 5 border districts are native local residents,
except in OChrov district of Cambodia, where remarkably, 93.40% of respondents are
non-native local residents. Regarding non-local dwellers, the average length of residency
across the cross-border regions vary from 10 years to 17 years.
2) Local Border Wholesalers
Most respondents (53.30 % to 76.60%) across 5 bordering districts are women, while 3
fifth of respondents in OChrov district of Cambodia are male border wholesalers. The
average age of respondents across the cross-border regions range from 31 to 49 years old.
All of respondents in both Kaysone Phomvihane of Lao PDR and Myawaddy district of
Myanmar are already married, while the rest (60.60% to 93.30%) of respondents across 4
border districts are married. Respondents across the cross-border regions are mostly their
respective nationals. Respondents across Thai border districts have higher educational
levels than counterparts in bordering districts. Monthly incomes also vary across the crossborder regions. Respondents in Aranyaprathet district of Thailand have highest average
monthly income of 373,334 Baht, while respondents in bordering OChrov district of
Cambodia have lowest average monthly income of 88,001 Baht. Respondents in bordering
Kaysone Phomvihane district of Lao PDR have highest (66.70%) number of local native
residents, followed by 53.30% of respondents from Muang Mukdahan district of Thailand.
Respondents in the 2 Thai border districts have more local native residents, which are
23.30% and 48.50% in Aranyaprathet and Maesod districts, respectively. On the other
hand, respondents in the 2 bordering districts have lower local native residents, which are
13.30% and 20% in OChrov district of Cambodia and Myawaddy district of Myanmar,
respectively. The average length of residency of non-local native residents across the
cross-border regions ranges from 4 years to 11 years.
66
67
CHPATER 6
MACRO LEVEL ANALYSIS OF CROSS-BORDER TRADE LINKAGES AND
COMPARATIVE ADVANTAGES BETWEEN THAILAND AND NEIGHBORING
COUNTRIES
This chapter describes the key factors contributing to expansion of cross-border trade
consisting of cross-border and regional infrastructure linkages, bilateral and regional trade
agreements, and regional trade facilitation initiatives. Essentially, an overview of crossborder trade relations between Thailand and 4 neighboring countries including CambodiaLao PDR-Malaysia and Myanmar is presented using time series data of 18 years (from
1996-2013). Bilateral cross-border trade problems will also be highlighted.
6.1 State of Cross-Border Trade Relations between Thailand and Neighboring
Countries
Cross-border trade is one of the key indicators of closer economic interdependence
between Thailand and neighboring countries. It expanded rapidly following the relaxation
of border restrictions stemming from occasional political conflicts (Thailand Development
Research Institute, 1997). Thailand possesses strategic geographical advantages at the
junction of mainland Southeast Asian region allowing businesses to conduct both crossborder trade and transit trade to a combined of 2.90 billion population in 9 countries, which
is divided into two groups of countries. The adjacent neighboring country markets can be
transacted through cross-border trade with total prospective consumers of 96.69 million
population in four countries comprising of CLMM. And the nearby neighboring country
markets can be transacted through cross-border transit trade with total prospective
consumers with 2.80 billion population in five countries consisting of Vietnam, India,
Bangladesh, China, and Singapore. However, there is a dichotomy of border trade
activities classified into formal and informal cross-border trade.
6.1.1 Formal Cross-Border Trade
The following analysis primarily focuses on formal cross-border trade between Thailand
and neighboring countries using available time series data of 18 years from 1996-2013.
Fostered by both geographical adjacency of structural differences and the above-mentioned
contributing factors, coupled with advancement of information technology, particularly the
Internet and mobile phones, local and regional cross-border trade has shown a rising trend.
The cumulative value of cross-border trade between Thailand and neighboring countries
significantly reached 200.40 billion US$ with a share of 58.66% of total international trade
value from neighboring countries. The cumulative share of cross-border export to these
neighbors was as high as 59.40%. The cumulative share of cross-border import was
40.59%, contributed by Malaysia (56.15%), Myanmar (35.39%), Lao PDR (6.82%) and
Cambodia (1.62%). As a result, Thailand gained significant cumulative balance of crossborder trade of 37.69 billion US$. The annual average growth of cross-border trade from
1996-2001 was 16.98% despite the fact that Thailand had faced severe financial crisis
during 1998-2001. During enforcement of AFTA from 2002-2013, it significantly kept
increasing to 22.47% per year (Table 6.1). Above all when the specified AFTA tariffs
became 0% in 2010, its annual cross-border trade growth considerably increased to 32.08%
compared with 2009. This growth could partly sustain national macroeconomic stability.
With increasing trend of international trade of Thailand, the intra-ASEAN trade and crossborder trade are also gradually rising though the proportion of share is low. Cross-border
trade during 2008-2013 has reached a significant level with an average share of 30.77% to
68
intra-ASEAN trade. This reflects the combined effects of bilateral and regional trade
agreements and regional trade facilitation initiatives. Similarly, the share of cross-border
trade to Thailands aggregate international trade with the world significantly rose from
1.02% in 1996 to 6.48% in 2012 or equivalent to 7.67% of Gross Domestic Product. Crossborder trade growth may somehow contribute to regional development as both urban and
rural people including the poor along border regions between Thailand and neighboring
countries can also benefit from trade, as well gain access to variety of products. This will
result in better quality of life. However, cross-border traded goods are mainly produced in
Bangkok, national capital city, and its vicinity like eastern region and regional growth
Table 6.1 International Trade Value of Thailand
Regional trade
1996-2001
Average
2002-2013 Average
Total
growth
Total
growth
(Billions of
Per year (Billions of Per year
US$)
(%)
US$)
(%)
1.Extra-ASEAN
584.30
0.82
2,926.17
9.36
2.Intra-ASEAN
123.55
1.74
737.78
13.92
2.1 Cross-border trade
11.49
16.98
188.91
22.47
2.2 Cross-border transit trade
0.30
23.50
21.08
36.91
(Singapore, Vietnam and Southern
region of China)
Total international trade
710.85
0.60
3,663.95
12.18
Source: Trades statistics for the period of 1996-2013 from the Department of Customs,
Thailand.
centers. At present, Thai border cities and towns mainly play a distribution role. In relation
to bilateral cross-border trade of goods with neighboring countries, trading is categorized
into two types consisting of (1) local and regional cross-border trade carried by land
transport and (2) international trade carried by sea and air freights. When both types of
trading are combined, the result will be aggregate international trade value. The bilateral
cross-border trades of goods with reference to neighboring countries are discussed below.
It is revealed that the pattern of cross-border trade and commerce greatly varies depending
on respective comparative advantages as follows:
1) Cambodia: During 1996-2013, the bilateral cumulative cross-border trade value was at
17.47 billion US$. The aggregate cross-border export increased substantially from 50
million US$ in 1996 to 2.78 billion US$ in 2013 with annual average growth of 29.38%
(Figure 6.1). In 2013, the aggregate bilateral cross-border trade with four-neighboring
countries accounted for 9.98% of aggregate cross-border trade value. Aranyaprathet border
checkpoint was the most important gateway accountable for 60% of total cross-border
trade export value. Aranyaprathet district is also the host site of Rong Kleua integrated
border wholesale market, the largest second-hand clothes market in Asia (Daily
Newspaper, 2010). There is an existing cross-border outsourcing of production especially
for ready-to-wear garments from Aranyaprathet district to bordering Poi Pet city of
Cambodia. Then, the finished clothes are re-exported for selling at Rong Kleua border
market. Therefore, this market plays crucial role in distributing goods locally and
regionally to garment clusters in Bangkok and other regional markets in Thailand.
Klongyai border checkpoint stands out in second place with 30% share. The rest is
contributed by 5 other border checkpoints. The major exported goods through
Aranyaprathet border checkpoint are motorcycles and parts, cement, engines, livestock
69
feed and chemical fertilizers, cars, liquefied petroleum gas and printed textiles
(Department of Customs of Thailand, 2013). The total cross-border import from Cambodia
steadily grew from 41 million US$ in 1996 to 261 million US$ in 2013. During the last 18
years, the annual average growth of cross-border import was at 26.11%. In 2013, the share
of Aranyaprathet border checkpoint was as high as 82%, followed by Klongyai border
checkpoint with 14.19%, Chantaburi and Chongchom border checkpoints each with 2%,
and the rest was shared by three other border checkpoints. The major imported goods from
Cambodia through Aranyaprathet border checkpoint are agricultural produce, recycled
products, second-hand clothes and ready to wear clothes (Department of Customs of
Thailand, 2013).
2) Lao PDR: During the last 18 years, the bilateral cumulative cross-border trade value
was 25.84 billion US$. Thailand gained favorable cumulative balance of cross-border trade
of 14.76 billion US$. In 2013, the share of bilateral cross-border trade with 4 neighboring
countries accounted for 14.24% of aggregate cross-border trade value. The aggregate
cross-border export gradually increased from 205 million US$ in 1996 to 3.53 billion US$
in 2013 (Figure 6.2). During the last 18 years, the annual average growth of cross-border
export was at 18.77%. In 2012, Nongkhai border checkpoint was the most important
gateway with highest share of 51% of total cross-border export value, followed by
Mukdahan border checkpoint with 11.00%, and the rest contributed by 6 other border
checkpoints. The major exported goods through Mukdahan border checkpoint were oil
products, cars, pellet cement, woven fabrics, medical equipments, diggers, polymers of
ethylene tiles and tires (Department of Customs of Thailand, 2013). Cross-border exports
from Thailand approximately serve half of Lao PDRs national population especially those
residing along border regions. The aggregate cross-border import from Lao PDR rose from
68 million US$ in 1996 to 769 million US$ in 2013. During almost 2 decades, the annual
average growth of cross-border import is 23.55%. In 2013, Mukdahan border checkpoint
became the most important entryway with share as high as 78%, followed by
Phiboonmangsahan border checkpoint (6%), Nongkhai border checkpoint (5%), and the
rest by six other checkpoints. The major imported goods through Mukdahan border
checkpoint were processed wood, parquet, electrical parts, underwear and clothes for men
and boys, zinc ore and work uniforms (Department of Customs of Thailand, 2013). In
terms of production linkages, outsourcing from Thailand to make clothes for work
uniforms in Lao PDR is important.
3) Malaysia: It is a more advanced developing market economy among bordering
countries. During the last 18 years, the bilateral cumulative cross-border trade value was
114.22 billion US$. The aggregate bilateral cross-border trade value expanded from 0.82
billion US$ in 1996 to 16.31 billion US$ in 2013, representing 54.07% of the aggregate
cross-border trade value with 4 neighboring countries (Figure 6.3). As a result, Thailand
gained favorable cumulative balance of 22.80 billion US$ from cross-border trade. The
aggregate cross-border trade export sharply escalated from 0.54 billion US$ in 1996 to
9.37 billion US$ in 2013. In almost 2 decades, the annual average growth of cross-border
export is 20.16%. In 2013, Sadao border checkpoint was the key export platform
facilitating a high share of 50.18%, followed by Padang Besar border checkpoint (46%),
Betong (1.48%) and Takbai (0.62%). The rest was contributed by 4 other checkpoints. The
major exported goods through Sadao border checkpoint were natural rubber, parts and
accessories of machinery, electrical parts, processed parawood, particle board, rubber hand
glove and print circuit board (Department of Customs of Thailand, 2013). The aggregate
cross-border import also sharply increased from 0.28 billion US$ in 1996 to 6.97 billion
70
US$ in 2013. In almost 2 decades, the annual average growth of cross-border import is
20.66%. Sadao border checkpoint dominated with 84% share, followed by Padang Besar
border checkpoint (14%), Sungai-Golok border checkpoint (1.01%) and the rest shared by
4 other border checkpoints. The major imported goods through Sadao border checkpoint
were electrical parts, parts and accessories of machinery, auto processors, plastic products,
synthetic rubber and chemical fertilizers (Department of Customs of Thailand, 2013).
4) Myanmar: The country has been facing economic sanction by the West since 1997. As
a result, Myanmar has heavily relied on cross-border trade of goods with bordering
countries mostly with Thailand, China and India (Aung, 2010). During the last 18 years,
the bilateral cumulative cross-border trade was at 42.94 billion US$. The aggregate crossborder trade with Myanmar gradually increased from 125 million US$ in 1996 to 6.46
billion US$ in 2013 (Figure 6.4). Its annual average growth of cross-border export is
27.55%. On the contrary, the annual average growth of cross-border import is 64.16%. In
2013, the aggregate bilateral cross-border trade with four-bordering countries accounted
for 21.41% of aggregate border trade value. Maesod, located in the west end of Thailands
section of the East-West Economic Corridor, facilitated as high as 54% of total crossborder export value, followed by Ranong (26%), Maesai (14%), Chiangsaen (3%),
Sangkhlaburi (2%) and the rest contributed by 3 other border checkpoints. The major
exported goods through Maesod border checkpoint were diesel and Benzene oils, vegetable
oil, motorcycles, woven cloth, fishing net, human drugs and consumer goods (Department
of Customs of Thailand, 2013). The aggregate cross-border import value sharply increased
from 21 million US$ in 1996 to 3.83 billion US$ in 2013 mainly resulting from
importation of mainly natural gas utilized for generating electricity in Thailand. As a
result, Thailand faced deficit in cumulative balance of 14.68 billion US$ due to crossborder trade with Myanmar. Sangklaburi temporary border checkpoint alone was the most
important gateway, largely for importing natural gas that contributed 96% of total crossborder import value. Maesod is ranked as second with 2%, followed by Ranong (1%),
Maesai (0.50%), and the rest by 5 others. The major imported commodities through
Maesod border checkpoint were wood, sea aquatic products, live cattle and agricultural
produces (Department of Customs of Thailand, 2013).
6.1.2 Informal Cross-Border Trade
Local border wholesalers play important role in cross-border supply chains as being either
indirect exporter or importer of goods. Despite the permission of local border retailing
functions at border crossing points, there is yet an existing illegal cross-border trade carried
out by both local people and outsiders. Data on the volume of informal cross-border trade
is unavailable. However, its trend seems likely to decline following tariff reductions, as
well as the continuing Royal Thai Government efforts to formalize cross-border trading. In
2011, the leading illegal commodities in the cross-border trade with respective countries
were from Myanmar (narcotics, personal cars, counterfeit bank notes, camera and
batteries); from Lao PDR (game box, clothes, fruits, garlic and narcotics); from Cambodia
(personal cars, dry chili, paddy, cassava, frozen prawn, second-hand clothes and cigar);
and from Malaysia (passenger cars, narcotics, motorcycle parts, compact disc and tractors)
(Department of Customs of Thailand, 2013).
6.1.3 Cross-Border Transit Trade
Consolidated cross-border transit trade is similarly on expanding trend. During 1996-2001,
Thailand transacted cross-border transit trade only with China with total value of 0.30
71
3,000
2,500
2,000
1,500
1,000
500
0
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Total export of cross-border trade
Total import of cross-border trade
Total export of international trade
Total import of international trade
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
199619971998199920002001200220032004200520062007200820092010 2011 20122013
Total export of cross-border trade
Total import of cross-border trade
Total export of international trade
Total import of international trade
72
Unit:Millions of US$
12,000
10,000
8,000
6,000
4,000
2,000
0
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Total export of cross-border trade
Total import of cross-border trade
Total export of international trade
Total import of international trade
4,500
Unit : Millions of US$
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Total export of cross-border trade
Total import of cross-border trade
Total export of international trade
Total import of international trade
billion US$ and average growth of 23.50 % per year, remaining the operation with China
alone until 2006. During 2002-2013, the aggregate cross-border transit trade increased to
21.08 billion US$ with annual average growth of 36.91% per year. Specifically, during
2007-2013, Thailand performed additional cross-border transit trade with 3 countries,
namely, China, Singapore and Vietnam with annual average growth of 77.38% per year. In
2013, the distributions of cross-border trade value with Singapore (via Songkhla province);
Vietnam (via Nongkhai; Mukdahan and Nakhonpanom provinces) and China (via
Chiangrai and Mukdahan provinces) were at 52.31%, 27.72% and 19.97%, respectively
(Department of Foreign Trade, 2013).
6.2 Thailands Bilateral Cross-Border Trade Problems With Neighboring Countries
Cross-border trade patterns between Thailand and neighboring countries considerably
varied from country to country, resulting from different stages of development and diverse
Table 6.2 Thailand Bilateral Cross-Border Trade Problems with Bordering Countries
Common problems
Applied to both Thailand and Cambodia,
Lao PDR and Myanmar (CLM)
1. Inefficient cross-border trade logistics and
long customs procedure at the border
checkpoints leading to high logistics costs.
2. Prevalent culture of corruption by authorities
responsible for trade facilitation resulting in
high cross-border trade transaction costs, which
lead to prevalence of illegally organized trade.
3. Traffic congestion at key border checkpoints
affecting trade flows.
4. Low adoption of Letter of Credit
5. Incidence of cross-border drug abuse and
human trafficking.
6. Government partly losing revenues from
ongoing importing and exporting of illegal trade
along the border.
7. Occasional volatility of Thai Baht currency
that sometimes affects purchasing power in
neighboring countries or lower competitiveness
of exporters-importers giving rise to Thai
products losing market shares. In turn,
currencies of CLM are sometimes not stabilized
resulting in unfavorable trade environment.
8. Tariff and non-tariff discriminatory
measures/barriers imposed by Lao PDR and
Myanmar caused more difficulties to Thai
traders in penetrating their markets and vice
versa.
9. Low trade performance from unilateral free
trade privileges due to complex import-export
procedures either from Thai or neighboring
countries sides resulted in continued shortage of
raw agricultural materials in Thailand.
10. Complex and changing financial system,
relevant rules and regulations and money
transfer procedures in neighboring countries
affecting cross-border trade environment.
11. Cross-border traders in CLM and Thailand
lack knowledge of international trade practices.
Country-specific problems
1. Cambodia
1.1 Frequent changes on applied customs tariffs and customs
practices do not meet international standard.
1.2 Transport of goods through local border crossings is
unable to operate daily.
1.3 Border conflict over co-management of Prasat Pra
Viharn temple in April 2011 led to a 10-15% loss of crossborder trade values between both countries for certain
period.
2. Lao PDR
2.1 Inter-provincial tax charge of 1% for goods movement
causing high cross-border trade costs.
2.2 High customs facilitation cost (e.g., over time charges)
and high import tax leading to illegally organized trade.
2.3 Frequent changes on trade rules and regulations on trade
of wood products (e.g., up to 20% tax charge for export).
2.4 Low trade facilitation performance causing delay on
trade of perishable goods.
2.5 Trade law is not standardized across Lao PDR.
2.6 High cost of cross-border money transfer.
2.7 Imposing import quota on selected commodities (e.g.,
cement, vegetable oil and steel).
3. Malaysia: Some Thai products do not meet Halal
standard.
4. Myanmar
4.1 Internal political uncertainty affecting cross-border trade
environment.
4.2 Unilateral closure of Myawaddy border checkpoint since
July 2010 until December 2011 leading to a loss of 80% of
cross-border trade value per month.
4.3 Frequent changes on applied customs tariffs and customs
formality do not comply with international standard.
4.4 Lack of local and regional road infrastructure.
4.5 Long importation process (2 days).
4.6 Lack of decentralization of power to local officials in
issuing ASEAN Integration System of Preferences (AISP)
certificate.
4.7 Several routes for imported goods are risky as they are in
minority group strongholds, which are not authorized by
Burmese government.
74
Common problems
12. Limited authorized banks in border cities of
CLM, and border trade largely transacted in
informal manner relying on mutual trust,
affecting confidence and diluting business
environment and trade expansion.
Country-specific problems
5.Thailand
5.1Low degree of integration and coordination of agencies
responsible for cross-border trade promotion and facilitation
5.2 Rapid urbanization of border cities causing urban
environmental problems (e.g., slum, solid waste and waste
water, etc.)
Sources: Based on field surveys during 2010-2011.
political and economic systems. Though the trend of cross-border is flourishing, a number
of both common and country-specific bilateral cross-border trade problems still existed, as
presented in Table 6.2 above.
6.3 Factors Contributing to Expansion of Cross-Border Trade
Cross-border trade had been carried out inter-generationally by local inhabitants, gradually
evolving from a very informal manner to become a more formal system as perceived
today. The Department of Foreign Trade of Thailand (2011) defines cross-border trade as
all forms of trade or exchange of goods transacted through border checkpoints by local
people or traders who reside in both sides of provinces or communities along the border.
Currently, there are a total of 71 border checkpoints across Thailand. Their specific
locations are presented in Map 1.1. There are broadly four factors contributing to dynamic
cross-border trade in the context of Thailand, consisting of cross-border and regional
infrastructure linkages, bilateral and regional trade agreements, bilateral and regional
investment agreements and regional trade facilitation initiatives.
6.3.1 Cross-Border and Regional Infrastructure Linkages
Out of 77 provinces of Thailand, 32 provinces share common border with 4 neighbouring
countries (river border with Lao PDR and land border with Cambodia, Malaysia and
Myanmar) with a total length of 5,582 Km, distributed in: 10 western and northern
provinces along Myanmar with a length of 2,400 Km; 11 northeastern provinces along Lao
PDR (1,810 Km); 7 northeastern and eastern provinces along Cambodia (725 Km) and 4
southern provinces along Malaysia with shortest length of (647 Km). Extensive crossborder infrastructure linkages have been developed over the years. As an emerging donor
country, during 2005-2009, Thailand has extended cumulative grant to Cambodia, Lao
PDR and Myanmar (CLM) with a total of 201.87 million US$ to develop cross-border rail
links, interprovincial roads and airports towards sub-regional transport integration and
multimodal linkages (NEDA, 2009). The major railways linking with neighboring
countries that are currently in operation are from Bangkok to Vientiane, capital city of Lao
PDR and Bangkok to Penang state of Malaysia. Chiangsaen river port in Chiangrai
province, which is in operation since 2003, plays vital role in connecting northern region of
Thailand with southern region of China. And the second Chiangsaen river port was
constructed just about 10 Km away downstream (NESDB, 2008). Thailand participates in
the GMS Information Superhighway Network (ISN), which strengthens GMS-wide
network to support regional integration (ADB, 2007). In addition, Thailand has taken part
in other two overlapping regional highway networks, notably, the ASEAN Highway
Network signed in 1999 and Asian Highway Network signed in 2005, which are extended
over the country at 12 routes with a total road length of 3,430 Km (Department of
Highways of Thailand, 2011).
75
76
(35.39%), Lao PDR (6.82%), and Cambodia (1.62%). As a result, Thailand gained
significant cumulative balance of 37.69 billion US$ from cross-border trade. The annual
average growth of cross-border trade from 1996-2001 was 16.98% despite the fact that
Thailand had faced severe financial crisis during 1998-2001. During enforcement of AFTA
from 2002-2013, it significantly kept increasing to 22.47% per year. Above all, when the
specified AFTA tariffs became 0% in 2010, its annual cross-border trade growth
considerably increased to 32.08% compared with 2009. This growth could partly sustain
national macroeconomic stability. With increasing trend of Thailands international trade,
the intra-ASEAN trade and cross-border trade are also gradually rising, though the
proportion of share is low. Cross-border trade during 2008-2013 has reached a significant
level with average share of 30.77% to the intra-ASEAN trade. This reflects the combined
effects of bilateral and regional trade agreements and regional trade facilitation initiatives.
Similarly, the share of cross-border trade to Thailands aggregate international trade with
the world significantly rose from 1.02% in 1996 to 6.48% in 2012 or equivalent to 7.67%
of Gross Domestic Product. Cross-border trade growth may somehow contribute to
regional development as both urban and rural people including the poor along border
regions between Thailand and neighboring countries can also benefit from trade, as well as
gain access to variety of products. This will result in better quality of life. However, crossborder traded goods are mainly produced in Bangkok, national capital city, and its vicinity
like eastern region and regional growth centers. At present, Thai border cities and towns
mainly play distribution role. In addition, there is an existing informal or illegal crossborder trade carried out by both local people and outsiders. There is no available data on
the volume of informal cross-border trade. However, its trend seems likely to decline
because of tariff reductions and continuing efforts to formalize cross-border trading.
Likewise, consolidated cross-border transit trade to Singapore, Vietnam and China is on
expanding trend. Patterns of cross-border trade between Thailand and neighboring
countries considerably varied from country to country, resulting from different stages of
development and diverse political and economic systems. Consequently, a number of
common and country-specific bilateral cross-border trade problems still exist. The factors
contributing to expanding cross-border trade included cross-border and regional
infrastructure linkages, bilateral and regional trade agreements, bilateral and regional trade
agreements and regional trade facilitation initiatives.
It is noticeable that regional integration initiatives such as the ASEAN Community and the
Greater Mekong Sub-region development cooperation play vital role in fostering closer
interdependence within member countries. Spatially, advancement of the Greater Mekong
Sub-region economic corridors has strengthened border cities linking Thailand and
bordering countries to emerge as strategic gateways. Coupled with continued cross-border
infrastructure development and improved trade facilitation, these border cities have
gradually transformed their roles towards becoming new peripheral growth centers,
particularly on both cross-border trade and cross-border transit trade of goods. As a result,
these networks of peripheral growth centers could functionally facilitate intra-ASEAN
trade in particular and Asian and global trade in general. Therefore, the hypothesis staing
cross-border trade regions are expected to gain infrastructural, economic and service
benefits at the regional scale due to production and trading linkages is supported.
78
CHAPTER 7
COMPARATIVE MICRO LEVEL ANALYSIS OF CROSS-BORDER FLOWS
OF GOODS AND SERVICES
This chapter presents comparative cross-border analysis of flows of goods and services at
micro level. The detailed comparative analysis focuses on local cross-border large scale
trading.
7.1 Local Cross-Border Large Scale Trading
The characteristics of local cross-border large scale trading are as follows:
1) Cross-border trade segments
Table 7.1 below presents cross-border trade segments at the cross-border regions.Trade
segments significantly vary across the cross-border regions. Ranging from 23.30% to
48.10% of respondents across the Thai border districts are cross-border exporters only. In
contrast, 33.30% to 83.30% of respondents across the bordering districts are cross-border
importers only, as shown in the following table. More than a tenth of respondents across
the bordering districts are both exporters and importers. For comparative analysis, almost a
third of respondents in Aranyaprathet district of Thailand are cross-border exporters only.
Almost a fifth are either cross-border exporters and importers or provider of shipping
services. More than a tenth are either a combination of cross-border exporters-importers
and wholesalers or integrated cross-border exporters-importers, wholesalers and retailers.
Few of the respondents are cross-border importers only. In OChrov district of Cambodia,
a third of respondents are either cross-border importers only or both cross-border exporters
and importers. More than a tenth of respondents are either cross-border exporters only or a
combination of cross-border exporters-importers and wholesalers. One respondent is an
integrated cross-border exporter-importer, wholesaler and retailer.
Table 7.1 Cross-border trade segments
Cross-border trade
segment
Cross-Border Region 1
Tha
Cam
F
%
F
%
7
31.8
2
13.3
1
4.5
5
33.3
4
18.2
5
33.3
1. Export only
2. Import only
3. Both export and
import
4. Combination of
3
18.6
2
13.3
export-import and
wholesaling
5. Integrated export3
13.6
1
6.7
import, wholesaling
and retailing
6. Shipping services
4
18.2
0
0
7. Re-export only
0
0
0
0
Total
22
100
15
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
7
23.3
0
0
15
50
25
83.3
4
13.3
3
10
Cross-Border Region 3
Tha
Mya
F
%
F
%
26
48.1
6
20
7
13
20
66.7
6
11.1
4
13.3
6.7
3.7
16.7
2
0
30
6.7
0
100
0
2
30
0
6.7
100
4
0
54
7.4
0
100
0
0
30
0
0
100
Also, more than a tenth of respondents in both Muang Mukdahan district of Thailand and
Kaysone Phomvihane district of Lao PDR are both cross-border exporters and importers.
Half of respondents in that district are cross-border importers only and almost a quarter are
79
cross-border exporters only, doing business with Savannakhet and neighboring provinces
in Lao PDR. Few of respondents are either a combination of cross-border exportersimporters and wholesalers or provider of shipping services. On the contrary, most of
respondents in Kaysone Phomvihane district of Lao PDR are cross-border importers only,
as well as being sole authorized dealers from Thailand, doing business either within
Savannakhet province or southern region of Lao PDR. Few of respondents are re-exporters
only. For comparison, almost half of the respondents in Maesod district of Thailand are
cross-border exporters only. Almost 2 fifth are integrated cross-border exporters-importers,
wholesalers and retailers and more than a tenth are cross-border importers only. A tenth of
respondents are both cross-border exporters and importers and a few are either shipping
services providers or a combination of cross-border exporters-importers and wholesalers.
While 2 third of respondents in Myawaddy district of Myanmar are cross-border importers
only, a fifth are cross-border exporters only and less than a fifth of respondents are both
cross-border exporters and importers.
The above analysis of local border trade segments comparing Thailand and bordering
countries of Cambodia, Lao PDR and Myanmar clearly reflects different comparative
advantages that each country is specialized. This resulted from the structure of productions
of Thailand, which is classified as an upper middle-income country and more advanced
that less developed bordering countries. Thailand has obviously emerged as a core trading
nation in the Greater Mekong Sub-region in particular and in ASEAN and the global
market in general. On the contrary, the bordering countries tend to act as peripheral areas
of Thailand.
2) Registration of businesses
Table 7.2 below presents the types of businesses registered in border economic zones.
Such types of registration greatly vary across the cross-border regions depending on
specific rules and regulations in doing business in respective bordering countries. Ranging
from 40.70% to 56.70% of the respondents across Thai border districts registered as
partnership limited, whereas, 90% of respondents in both bordering Kaysone Phomvihane
district of Lao PDR and Myawaddy district of Myanmar registered as company limited
Table 7.2 Registrations of businesses
Type of
registration
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
4.5
14
93.3
1
6.7
1
6.7
12
54.5
0
0
0
0
0
0
Merchant shop
Tax payer
Partnership limited
Ordinary
partnership
Company limited
9
40.9
0
0
Total
22 100
15
100
Source: Field survey during 2009-2012
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
3
10
0
0
0
0
17
56.7
0
0
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
16
29.6
0
0
0
0
3
10
22
40.7
0
0
1
1.9
0
0
13
30
15
54
43.3
100
27
30
90
100
27.8
100
27
30
90
100
with much higher practice. For comparative analysis, more than half of respondents in
Aranyaprathet district of Thailand registered as partnership limited, 2 fifth registered as
company limited, and one respondent registered as merchant shop. In contrast, most of
respondents in OChrov district registered as merchant shop and one respondent registered
as tax payer. Similarly, more than half of respondents in Muang Mukdahan district of
80
Thailand registered as partnership limited and less than half as company limited. Likewise,
most of respondents in Kaysone Phomvihane district of Lao PDR registered as company
limited and one tenth have merchant shops. Two fifth have registered their businesses as
partnership limited in Maesod district of Thailand,more than a quarter registered either as
merchant shops or company limited, and one respondent registered as ordinary partnership.
Correspondingly, most of respondents in Myawaddy district of Myanmar registered their
businesses as company limited and a tenth as tax payer.
3) Duration of operation of business establishment
Table 7.3 below provides information about the duration of operation of business
establishments in three cross-border regions.
Table 7.3 Duration of operation of business establishments
Duration of
operation of
establishmen
t
10 years
10-15 years
>15 years
Total
Average
Standard
deviation
Cross-Border Region 1
Tha
Cam
F
%
F
%
10
45.4
8
53.3
8
36.3
4
26.7
4
18.0
3
20
22
100
15
100
11
11
4
4
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
11 36.6
12
40.0
18
60.0
9
30.0
1
3.33
9
30.0
30
100
30
100
11
13
3
5.2
Cross-Border Region 3
Tha
Mya
F
%
F
%
26
48.2
11 36.6
25
46.3
15
50
3
5.5
4
13.3
54
100
30
100
10
12
4
3.3
2 p-value
0.65
0.009
0.36
81
Chi-Square test is applied to the above table to understand the similarities and differences
about the duration of operation of business establishments in the cross-border regions. It is
evident that a significant difference is observed between Muang Mukdahan district of
Thailand and Kaysone Phomvihane district of Lao PDR as its p-value for this test is
significant at 99% confidence level. There is no significant difference in two other crossborder regions (Aranyaprathet district of Thailand and OChrov district of Cambodia and
Maesod district of Thailand and Myawaddy district of Myanmar) as indicated by its pvalue.
4) Cross-border exported commodities
Table 7.4 presents cross-border exported commodities in the three cross-border regions.
Table 7.4 Cross-border exported commodities (Multiple responses)
Commodity
Cross-Border Region
Cross-Border Region 1
Cross-Border Region 2
Tha
Cam
Tha
Lao
F
%
F
%
F
%
F
%
1. Consumer goods
8
25
0
0
5
17.9
0
0
2. Food products
6
18.8
0
0
2
7.1
0
0
3. Electric appliances
5
15.6
0
0
5
17.9
0
0
4. Brand-new clothes
3
9.4
0
0
4
14.3
0
0
5. Brand-new shoes
2
6.3
0
0
1
3.6
0
0
6. Brand-new leather
2
6.3
0
0
0
0
0
0
7. Fruits and vegetables
1
3.1
0
0
1
3.6
0
0
8. Kitchenwares
1
3.1
0
0
3
10
0
0
9. Textile and garment
1
3.1
0
0
0
0
0
0
10. Construction
1
3.1
0
0
2
7.1
0
0
materials
11. Fuel and cooking
1
3.1
0
0
0
0
0
0
gas
12. Spare parts of
1
3.1
0
0
1
3.6
0
0
motorcycle and bicycle
13. Agricultural
0
0
1
20
2
7.1
1
50
produces
14. Secondhand clothes
0
0
1
20
0
0
0
0
15. Woods and
0
0
1
20
0
0
1
50
handicraft products
16. Recycled products
0
0
2
40
0
0
0
0
17. Machinery
0
0
0
0
1
3.6
0
0
18. Live cattle
0
0
0
0
1
3.6
0
0
19. Jewelry
0
0
0
0
0
0
0
0
20. Furniture
0
0
0
0
0
0
0
0
Total
32
100
5
100 28
100
2
100
Source: Field survey during 2009-2012.
Cross-Border Region 3
Tha
Mya
F
%
F
%
16
22.9
0
0
9
12.9
0
0
10
14.3
0
0
4
5.7
0
0
1
1.4
0
0
0
0
0
0
2
2.8
0
0
2
2.8
0
0
1
1.4
0
0
5
7.1
0
0
0
8.6
2.8
55.6
0
0
0
0
0
3
0
33.3
0
2
0
0
1
54
0
2.8
0
0
2.8
70
0
0
0
1
0
30
0
0
0
11.1
0
100
Cross-border traded goods are clearly based on comparative advantages and geographical
adjacency of structural differences. Thai goods are widely accepted among bordering
countries due to high quality control standards, reasonable prices and a variety of choices.
Cross-border exported commodities across Thai border districts are quite similar and
mainly consisting of consumer goods, intermediate and capital goods. Almost a quarter of
respondents in Aranyaprathet and Maesod districts and almost a fifth of respondents in
Muang Mukdahan district of Thailand trade consumer goods. Whereas, cross-border
exported commodities across the bordering districts slightly vary, with half of respondents
82
83
materials, more than a tenth of respondents import electric appliances, and only very small
proportion of respondents import either machines, medicines or liquors.
Table 7.5 Cross-border imported commodities (Multiple responses)
Commodity
Cross-Border Region
Cross-Border Region 1
Cross-Border Region 2
Tha
Cam
Tha
Lao
F
%
F
%
F
%
F
%
1. Agricultural produces
6
37.5
0
0
7
35
0
0
2. Dry freshwater fish
3
18.8
0
0
0
0
0
0
3. Live freshwater fish
1
6.3
0
0
0
0
0
0
4. Rice
0
0
2
10.5
0
0
0
0
5. Dry aquatic products
0
0
0
0
1
5
0
0
6. Second-hand clothes
2
12.5
0
0
0
0
0
0
7. Brand-new clothes
1
6.3
0
0
1
1
0
0
8. Second-hand shoes
1
6.3
0
0
0
0
0
0
9. Second-hand leather
1
6.3
0
0
0
0
0
0
10. Hand woven clothes
0
0
0
0
0
0
0
0
11. Construction materials
0
0
10
52.6
0
0
5
15.2
12. Animal feed and
0
0
3
15.8
0
0
0
0
fertilizers
13. Car and motorcycles
0
0
2
10.5
0
0
0
0
14. Used cars
0
0
0
0
0
0
0
0
15. Auto parts
0
0
0
0
0
0
3
9.1
16. Machinery
0
0
0
0
1
5
1
3
17. Cooking gas
0
0
1
5.3
0
0
0
0
18. Fuel
0
0
0
0
0
0
0
0
19. Consumer goods
0
0
0
0
0
0
18
54.6
20. Cosmetics
0
0
0
0
0
0
0
0
21. Liquour and beverage
0
0
0
0
0
0
1
3
22. Medicines and
0
0
0
0
0
0
1
3
medical apparatus
23. Electric appliances
0
0
0
0
0
0
4
12.1
24. Wood furniture
0
0
0
0
0
0
0
0
25. Processed wood
0
0
0
0
10
50
0
0
26. Forest products
0
0
0
0
0
0
0
0
27. Kitchenwares
0
0
0
0
0
0
0
0
28. Fishing net
0
0
0
0
0
0
0
0
29. Recycled products
1
6.3
0
0
0
0
0
0
Total
16
100
19
100
28
100
33
100
Source: Field survey during 2009-2012.
Cross-Border Region 3
Tha
Mya
F
%
F
%
9
45
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
5
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
5
0
0
0
0
2
4.3
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
2
2
1
2
9
5
3
5
0
2.2
2.2
4.3
2.2
4.3
19.6
10.9
6.5
10.9
0
7
0
2
0
0
0
20
0
35
0
10
0
0
0
100
5
0
0
0
3
2
1
46
10.9
0
0
0
6.5
4.3
2.2
100
6) Sources of procurement
There are strong supply chain linkages across the border districts within Thailand with
Bangkok metropolis and its vicinity and vice versa. This means Bangkok metropolis and
its vicinity play crucial role as a core production region in the Greater Mekong
Sub-region. This is evident from half of respondents in both Aranyaprathet and Maesod
districts, and more than a third of respondents in Muang Mukdahan district of Thailand
who directly obtain goods from Bangkok metropolis and its vicinity. Moreover, 3 quarters
of respondents in OChrov district of Cambodia and almost half of respondents in both
Kaysone Phomvihane district of Lao PDR and Myawaddy district of Myanmar also
procure goods directly from cross-border manufacturers in Bangkok metropolis and its
vicinity within Thailand. For comparative analysis, almost a third of respondents in
84
Aranyaprathet district of Thailand procure goods from cross-border wholesalers. There are
very few respondents who acquire goods from either wholesalers, regional wholesalers or
local community enterprises in Bangkok metropolis and its vicinity. Correspondingly, less
than a fifth of respondents in OChrov district of Cambodia obtain goods from regional
Table 7.6 below presents sources of procurement in three cross-border regions.
Table 7.6 Sources of procurement (Multiple responses)
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
0
0
0
17.5
0
1
0
2.8
0
0
0
0
4
5
5.9
7.4
0
6
0
19.4
5.9
2.8
5.9
14
38.9
14
38.9
14
20.6
19.4
3.25
0
0
1
2
2.8
5.6
1
1
2.8
2.8
0
0
0
0
0
0
0
0
14
38.9
5.6
35
51.5
6.5
76.5
11.1
17
47.2
8.8
15
48.4
100
30
100
36
100
68
100
30
100
Sourcing
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
3.6
0
0
1. Local community
enterprise
2. Local wholesalers
0
0
0
3. Regional
1
3.6
3
wholesalers
4. Wholesalers in
1
3.6
1
capital city
5. Cross-border
9
32.1
0
wholesalers
6. Cross-border
0
0
0
wholesalers in capital
city
7. Local manufactures
0
0
0
8. Regional
0
0
0
manufacturers
9. Manufacturers in
16
57.1
0
capital city and
vicinity
10. Cross-border
0
0
13
manufacturers in
capital city
Total
28
100
17
Source: Field survey during 2009-2012.
wholesalers and only a small proportion of respondents procure goods from wholesalers in
Phnom Penh, the capital city of Cambodia. Similarly, more than a third of respondents in
both Muang Mukdahan district of Thailand and Kaysone Phomvihane district of Lao PDR
acquire goods from cross-border wholesalers in their adjacent border cities and only a
small proportion of respondents in both districts purchase from local manufacturers. A
tenth of respondents in Muang Mukdahan district of Thailand obtain from cross-border
manufacturers and very few acquire from regional wholesalers. On the contrary, few
respondents in Kaysone Phomvihane district of Lao PDR purchase goods from
manufacturers in Vientiane, the capital city of Lao PDR and very few respondents acquire
goods from either regional manufacturers or wholesalers in Vientiane city. Also, a fifth of
respondents in Maesod district of Thailand procure from cross-border wholesalers and less
than a tenth take from either cross-border manufacturers or regional wholesalers. A few of
respondents acquire either from wholesalers in Bangkok metropolis and its vicinity or local
wholesalers. Whereas, almost a fifth of respondents in Myawaddy district of Myanmar
acquire either from regional wholesalers in Myanmar or cross-border wholesalers in
Maesod city of Thailand, a few procure from manufacturers in Yangon, the former capital
85
city of Myanmar. Only a very small proportion of respondents obtained goods from crossborder wholesalers in Bangkok metropolis and its vicinity.
7) Origin of goods
Table 7.7 below presents origins of goods in three cross-border regions.
Table 7.7 Origin of goods (Multiple responses)
Country
Cross-Border Region 1
Tha
Cam
F
%
F
%
1. Thailand
18
47.4
13
76.5
2. Lao PDR
0
0
0
0
3. Cambodia
8
21.1
4
23.5
4. Myanmar
1
2.6
0
0
5. Vietnam
3
7.9
0
0
6. Malaysia
1
2.6
0
0
7. Singapore
1
2.6
0
0
8. China
3
7.9
0
0
9. South Korea
2
5.3
0
0
10. Japan
1
0
0
0
11. USA
0
0
0
0
Total
38
100
17
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
14
37.8
28
57.1
13
35.1
1
2
0
0
1
2
0
0
0
0
2
5.4
5
10.2
0
0
2
4.1
0
0
2
4.1
7
18.9
3
6.1
0
0
3
6.1
1
2.7
0
0
0
0
2
4.1
37
100
49
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
45
60
24
70.6
0
0
0
0
0
0
0
0
17
22.7
7
20.6
0
0
0
0
1
1.3
0
0
0
0
0
0
5
6.7
0
0
0
0
0
0
5
6.7
2
5.9
2
2.7
1
2.9
54
100
34
100
Thai goods hold a large market share at varying range of 38% to 77% of total traded
commodities across the cross-border regions. Collectively, ASEAN goods have high
market share ranging from 78.30% to 100% across the cross-border regions. For
comparative analysis of the goods country of origin, almost half of respondents in
Aranyaprathet district of Thailand and more than 3 quarters of respondents in OChrov
district of Cambodia replied that their goods originate from Thailand. Slightly more than a
fifth of respondents in Aranyaprathet district indicated Cambodia, a few expressed either
China or Vietnam, a few also stated South Korea and only a very small proportion of
respondents answered either Malaysia, Myanmar, Singapore or Japan. Almost a quarter of
respondents in OChrov district of Cambodia stated that traded goods are produced within
Cambodia.
Similarly, more than half of respondents in Kaysone Phomvihane district of Lao PDR, and
more than a third of respondents in Muang Mukdahan district of Thailand replied that
goods are made in Thailand. More than a third of respondents in Muang Mukdahan district
of Thailand replied that goods are produced in Lao PDR, almost a fifth informed that
goods are produced in China, a few expressed that goods are made in Vietnam and one
respondent stated that goods are manufactured in Japan. Whereas, a tenth of respondents in
Kaysone Phomvihane district of Lao PDR answered that goods are made in Vietnam, a few
informed that goods are made in either China or South Korea. Few respondents also stated
that goods are produced either in Malaysia, Singapore or USA and only a very small
proportion of respondents expressed that goods are made in either Lao PDR or Cambodia.
Likewise, 3 fifth of respondents in Maesod district of Thailand and 3 quarters of
respondents in Myawaddy district of Myanmar disclosed that goods are made in Thailand.
Slightly a fifth of respondents in Maesod district of Thailand acquire goods which are
produced in Myanmar and almost a tenth replied that goods are produced in either China or
86
Japan. There are very few respondents who expressed that goods originated either from
USA or Malaysia. Similarly, a fifth of respondents in Myawaddy district of Myanmar
obtain goods which are made in Myanmar and a few acquire goods which originated either
from Japan or USA.
8) Roles of cross-border traders
Table 7.8 below presents roles of cross-border traders in three cross-border regions.
Table 7.8 Roles of cross-border traders (Multiple responses)
Trading role
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
2
6.6
4
13.3
Cross-Border Region 3
Tha
Mya
F
%
F
%
7
12.9
0
0
13.3
28
93.
3
20
66.6
15
27.7
17
56.6
6.7
28
51.8
11
36.6
80
10
6.6
10
100
30
100
30
100
54
100
30
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
0
0
0
0
1. Authorized
distributor
2. Distributor to both
15
68.2
2
border province and
across a
neighboring
country/home country
7
31.8
1
3. Sole exporter across
a neighboring country
4. Sole authorized
0
0
12
distributor across
home
country/bordering
country
5. Being cross-border
0
0
0
franchising
Total
22
100
15
Source: Field survey during 2009-2012.
The role of cross-border traders across the cross-border regions remarkably vary depending
on the extent of market penetration. Ranging from 13% to 93% of respondents across the
cross-border regions are distributors to both bordering and other provinces either in a
neighboring country or in their respective home countries. This means that cross-border
traders play important role in promoting cross-border supply chain linkages. For
comparative analysis, more than 2 third of respondents in Aranyaprathet district of
Thailand are distributors in both bordering Banteay Meanchey province and across
Cambodia. Less than a third of respondents are sole exporters across Cambodia. While 4
fifth of respondents in OChrov district of Cambodia are sole authorized distributors from
Thailand across Cambodia, more than a tenth are distributors in both Banteay Meanchey
province and across Cambodia and one respondent is sole exporter across Thailand.
Likewise, most of respondents in Muang Mukdahan district of Thailand are distributors in
both bordering Savannakhet province and across Lao PDR and few of respondents are
authorized distributors across Lao PDR. Similarly, 2 third of respondents in Kaysone
Phomvihane district of Lao PDR are distributors in both Savannakhet province and across
Lao PDR. More than a tenth of respondents are authorized distributors from Thailand to
both Savannakhet and neighboring provinces and a tenth are either sole authorized
distributors from Thailand across Lao PDR or cross-border franchisers from Thailand.
Also, slightly more than half of respondents in Maesod district of Thailand are sole
exporters across Myanmar, more than a quarter are distributors to both bordering Kayin
87
state and across Myanmar, and more than a tenth are authorized distributors from Thailand
across Myanmar. Correspondingly, more than half of respondents in bordering Myawaddy
district of Myanmar are distributors in both Kayin state and across Myanmar. More than a
third of respondents are sole exporters across Thailand and a few are sole authorized
distributors from Thailand across Myanmar.
9) Forms of cross-border payment
Table 7.9 below presents the forms of cross-border payments in three cross-border regions.
Table 7.9 Forms of cross-border payments
Form of payment
Cross-Border Region 1
Tha
Cam
F
%
F
%
11
50
0
0
5
22.7
0
0
0
0
0
0
1. Cash
2. Credit
3. Combination of
cash and credit
4. Money transfer
4
18.2
10
66.7
through local banks
in border cities in
Thailand
5. Letter of credit
2
9.1
0
0
6. Money transfer
0
0
5
33.3
from their
headquarters to
suppliers in
Thailand
7. Barter trade
0
0
0
0
Total
22
100
15
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
6
20
9
30
9
30
2
6.7
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
31
57.4
25
83.3
10
18.5
0
0
4
7.4
5
16.7
12
40
12
40
5.6
3
0
10
0
3
0
10
0
3
0
5.6
0
0
0
0
0
0
30
0
100
0
30
0
100
3
54
5.6
100
0
30
0
100
The forms of cross-border payment greatly vary across the cross-border regions. Thai Baht
is the most used exchange currency because it has a sub-regionally strong acceptance and
low fluctuation. Due to convenient arrangement, payment by cash is widely adopted by
20% to 83.3% of respondents across the 5 border districts, except in OChrov district of
Cambodia where 2 third of respondents process payments by money transfer through local
banks in bordering Aranyprathet city in Thailand. For comparative analysis, half of
respondents in Aranyaprathet district of Thailand pay by cash, almost a quarter pay by
credit, and almost a fifth pay by money transfer through local banks in bordering
Aranyaprathet city in Thailand, as counterpart Cambodian traders can conveniently open
bank account in Thai border city of Aranyaprathet. Almost a tenth of respondents open
Letter of Credit (L.C), whereas, a quarter of respondents in OChrov district of Cambodia
answered that their headquarters in Phnom Penh directly transfer money to regional
suppliers in Thailand.
Likewise, utilizing border banking services in Thailand is considered convenient by 2 fifth
of respondents in both Muang Mukdahan district of Thailand and Kaysone Phomvihane
district of Lao PDR who manage money transfer to cross-border suppliers at local banks in
Muang Mukdahan city of Thailand. A tenth of respondents in both districts rely on L.C.,
almost a third in Muang Mukdahan district of Thailand pay by credit due to long mutual
trust, and a fifth pay by cash. Whereas almost a third of respondents in Kaysone
88
Phomvihane district of Lao PDR pay by cash, a few make use of credit. Correspondingly,
half of the respondents in Maesod district of Thailand pay by cash and almost a fifth pay
by credit (owing to long mutual trust) which is normally due in 1 month. Almost a tenth
adopt a combination of cash and credit, a few apply either money transfer (through local
banks in bordering Maesod city), barter trade or usage of L.C. Also, more than 4 fifth of
respondents in Myawaddy district of Myanmar make payments by cash and the rest of
respondents pay by a combination of cash and credit.
10) Cross-border logistics arrangements
Table 7.10 presents cross-border logistics arrangements in three cross-border regions.
Table 7.10 Cross-border logistics arrangements
Logistics mode
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
4.5
0
0
1. Transported by
cart carriers
2. Rely on local
15
68.2
2
13.3
cross-border
logistics providers
3. Arranged by
0
0
1
6.7
buyers from
bordering cities
4. Arranged by
1
4.5
1
6.7
their own company
5. Arranged by
5
22.7
11
73.3
manufacturers in
Thailand
6. Scheduled bus
0
0
0
0
crossing the
international river
7. Boat crossing the
0
0
0
0
international river
Total
22
100
15
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
0
0
20
66.6
18
60
25
46.3
27
90
3.3
11
36.7
3.7
30
3.3
3.8
3.8
22
40.7
10
30
100
30
100
54
100
30
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
4.5
0
0
12
54.5
3
20
8
36.3
4
26.7
1
4.5
8
46.6
22
100
15
100
7
21
2.6
4.5
Self-employed
5 workers
5-15 workers
>15 workers
Total
Mean
Standard
deviation
Fisher-Exact
0.95
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
4
13.3
0
0
10
10
15
50
13
43.3
9
30
3
10
6
19.6
30
100
30
100
9
12
3
3.4
Cross-Border Region 3
Tha
Mya
F
%
F
%
2
3.7
0
0
23
42.6
0
0
19
35.2
8
26.6
10
18.6
22
73.3
54
100
30
100
10
41
3.1
6.3
0.009
0.000
90
Likewise, respondents in Kaysone Phomvihane district of Lao PDR employ higher average
number of labor with 12 local workers. While respondents in Muang Mukdahan district of
Thailand use lower average of 9 local and immigrant workers, less than half of respondents
in Muang Mukdahan district of Thailand engage 5 to 15 local and immigrant workers. A
tenth of respondents employ either less than 5 workers or more than 15 local and
immigrant workers. On the contrary, half of respondents in Kaysone Phomvihane district
of Lao PDR hire less than 5 local workers, almost a third engage 5 to 15 local workers, and
almost a fifth of respondents employ more than 15 local workers.
Similarly, respondents in Myawaddy district of Myanmar employ higher average number
of local labor with 41 workers, but respondents in Maesod district of Thailand use lower
average of 10 local and immigrant workers. More than 2 fifth of respondents in Maesod
district of Thailand employ less than 5 local and immigrant workers, more than a third of
respondents hire 5 to 15 local and immigrant workers, and almost a fifth engage more than
15 workers. On the other hand, almost 3 quarters of respondents in Myawaddy district of
Myanmar employ more than 15 local workers and slightly more than a quarter of
respondents hire 5 to 15 local workers.
Fisher-Exact test is applied to the above table to understand the similarities and differences
in terms of employment of labor in the cross-border regions. It is evident that significant
differences are observed in the 2 cross-border regions (Muang Mukdahan district of
Thailand and Kaysone Phomvihane district of Lao PDR and Maesod district of Thailand
and Myawaddy district of Myanmar), as the p-value shown in the table is significant at
99% confidence level. On the other hand, there is no significant difference between the
cross-border region of Aranyaprathet district of Thailand and OChrov district of
Cambodia as indicated by its p-value.
12) Employment of immigrant labor
Only respondents across Thai border districts employ immigrant labor with average of 6 to
9 workers. Respondents across Thai border districts who do not engage at all in
employment of immigrant labor, are represented by 4.50%, 7.40%, and 80% of
respondents in the districts of Aranyaprathet, Maesod, and Muang Mukdahan, respectively.
No immigrant child labor is hired across Thai border districts. For comparative analysis,
respondents in Maesod district engage the highest average number of immigrant labor with
9 workers. More than 4 fifth of the respondents hire migrant labor registered with the
Ministry of Labor of Thailand. Out of the total employment of immigrant labor, almost
half of the respondents in Maesod district engage less than 5 Burmese immigrant labor, a
third employ 5 to 15 Burmese immigrant labor, more than a tenth use more than 15
Burmese immigrant labor, and a few employ more than 15 Burmese immigrant workers.
Maesod district is followed by Aranyaprathet district with an average employment of 7
immigrant workers. Almost a third of respondents in Aranyaprathet district engage
registered immigrant labor, while almost half replied of hiring none registered immigrant
labor.
Out of total employment of immigrant labor, more than half of respondents in
Aranyaprathet district hire less than 5 Cambodian immigrant workers, more than a third
engage 5 to 15 Cambodian immigrant workers, and only very small proportion of
respondents employ more than 15 immigrant workers. Lastly, in Muang Mukdahan district,
respondents engage the lowest average number of Cambodian immigrant labor with 6
workers who are fully registered immigrant labor. Out of this number, more than a tenth of
91
respondents employ less than 5 Cambodian immigrant labor, and few hire 5 to 15
Cambodian immigrant labor. Chi-Square test is applied to the above table to understand
similarities and differences of employment of immigrant labor across the Thai border
regions. It is evident that significant differences are observed as its p-value indicated
significance at 99% confidence level.
Table 7.12 below presents employment of immigrant labor.
Table 7.12 Employment of immigrant labor
Number of labor
None employment
<5 workers
5-15 workers
>15 workers
Total
Mean
Standard deviation
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
24
80
0
0
4
13.3 0
0
2
6.7
0
0
0
0
0
0
30
100
0
0
6
0
3.5
0
0.000
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
4.5
0
0
20
54.5
0
0
1
36.3
0
0
0
4.5
0
0
22
100
0
0
7
0
5
0
2 p-value
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
7.4
0
0
25
46.3 0
0
18
33.3 0
0
7
13.0 0
0
54
100
0
0
9
0
8.3
0
Cross-Border Region 1
Tha
Cam
F
%
F
%
5
22.7
0
0
None
employment
<80 Baht
6
27.2
2
13.3
80-110 Baht
3
13.6
13
86.6
>110 Baht
8
36.0
0
0
Total
22
100
15
100
Mean
135
60
Standard
36
10
deviation
Fisher-Exact
0.003
Test p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
24
80
0
0
0
1
5
30
126
31
0
3.3
16.6
100
5
25
0
30
60
11
0.000
16.7
83.3
0
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
7.4
0
0
6
34
10
54
115
45
11.1
62.9
18.5
100
4
26
0
30
60
10
13.3
86.6
0
100
0.000
In 2011, the official minimum daily wage rates for Thai citizen in Thai border provinces of
Sakaeo, Mukdahan and Tak were set at 173 Baht, 165 Baht and 162 Baht, respectively.
Meanwhile, the immigrant labor earn slightly lower than the official minimum daily wage
92
rate at an average of 135 Baht, 126 Baht and 115 Baht in Aranyaprathet, Muang Mukdahan
and Maesod districts, respectively. Moreover, the average wage rates across the bordering
districts are still much lower at 60 Baht per day. Therefore, the average official minimum
daily wage rates across Thai border districts are almost 3 times higher than the counterpart
bordering districts.
For comparative analysis, the registered immigrant labors gain 2 times higher in wages
than those non-registered. The average daily wage for immigrant labor in Aranyaprathet
district of Thailand is 135 Baht. More than a third of respondents pay higher than 110 Baht
per day. Also, immigrant labor in Aranyaprathet district of Thailand gain 3 times higher in
wages than local labor in OChrov district of Cambodia. More than a quarter of
respondents in Aranyaprathet district of Thailand compensate workers with less than 80
Baht and more than a tenth of respondent remunerate with 80 Baht to110 Baht. On the
contrary, most of respondents in OChrov district of Cambodia offer local wage rates of 80
Baht to 110 Baht per day, more than a tenth remunerate with less than 80 Baht per day.
Likewise, the average daily wage for immigrant labor in Muang Mukdahan district of
Thailand is 126 Baht. More than a tenth of respondents compensate wth more than 110
Baht per day and one respondent pays 80 Baht to 110 Baht per day. Whereas most of
respondents in Kaysone Phomvihane district of Lao PDR compensate with local daily
wages of 80 Baht to 110 Baht, less than a fifth of respondents remunerate with less than 80
Baht per day.
Correspondingly, the average daily wage for immigrant labor in Maesod district of
Thailand is higher at 115 Baht. There is no wage differential between registered and nonregistered immigrant labor in Maesod district. Three fifth of the respondents in Maesod
district of Thailand pay daily wage rate of 80 Baht to 110 Baht to immigrant labor. Almost
a fifth of respondents pay higher than 110 Baht per day and slightly more than a tenth of
respondents pay less than 80 Baht. Whereas the average daily wage rate for local labor in
Myawaddy district of Myanmar is much lower at 60 Baht, most of respondents in
Myawaddy district provide local daily labor wages ranging from 80 Baht to 110 Baht, and
more than a tenth offer less than 80 Baht per day. Fisher Exact test is applied to the above
table to understand similarities and differences of daily wage rates of local and immigrant
labor in three cross-border regions. It is apparent that significant differences are observed
between three cross-border regions as the p-value indicated significance at 99% confidence
level.
14) Reasons for employing immigrant labor
Reasons for employing immigrant labor slightly vary across Thai border districts.
Respondents across Thai border districts replied that immigrant labor in their city is cheap,
so they can reduce managerial cost by 3.30%, 31.50% and 41% in Muang Mukdahan,
Maesod and Aranyaprathet districts, respectively. For comparative analysis, almost a fifth
of respondents in Aranyaprathet district and less than a fifth of respondents in Muang
Mukdahan district expressed that local Thai labor force are selective in terms of jobs.
Almost a fifth of respondents in Aranyaprathet district reported shortages of Thai labor
force in their city. Likewise, almost 2 fifth of respondents in Maesod district hire
immigrant labor because local Thai labor force refrains to work. More than a tenth of
respondents told that there is shortage of Thai labor force in their city and less than a tenth
of respondents indicated that immigrant labor is competent in communicating bordering
Burmese language. Few of respondents mentioned that local Thai labor force is either
93
selective in terms of jobs or immigrant labor possesses specific skill and craftsmanship.
Table 7.14 below presents the reasons for employing immigrant labor.
1. None
employment of
immigrant labor
2. Local Thai labor
4
18.1 0
force is choosy for
jobs.
3. Shortage of Thai
4
18.1 0
labor force in their
city
4. Immigrant labor
9
40.9 0
in their city is
cheap, so they can
reduce labor cost
5. Competent
0
0
0
communication of
neighboring
countrys language
6. Possess specific
0
0
0
skill and
craftsmanship
Total
22
100
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
24
80
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
7.4
0
0
16.6
20
37
14.8
3.3
17
31.5
5.6
3.7
30
100
54
100
1. None
employment
2. Daily
3. Seasonal
4. Circular
5. Long-term
immigration with
all family members
Total
Cross-Border Region 1
Tha
Cam
F
%
F
%
5
22.7
0
0
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
24
80
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
7.4
0
0
12
0
2
3
54.5
0
9
13.6
0
0
0
0
0
0
0
0
3
0
1
2
10
0
3.3
6.6
0
0
0
0
0
0
0
0
21
3
11
15
38.9
5.6
20.4
27.4
0
0
0
0
0
0
0
0
22
100
30
100
0
0.000
54
100
p-value
Source: Field survey during 2009-2012.
94
Cross-border movement patterns of immigrant labor considerably vary across Thai border
cities depending on whether there is an existing favorable policy or not. For instance,
Thailand unilaterally permits daily movement of immigrant labor particularly for
Cambodian nationals using Aranyaprathet as a pilot border checkpoint. Therefore, as high
as 55% of respondents in Aranyaprathet district reported daily cross-border movement. In
addition, 10% and 39% of respondents in both Muang Mukdahan and Maesod districts,
respectively, expressed daily movement.
For comparative analysis, more than a tenth of respondents in Aranyaprathet district stated
long-term immigration with all family members, and almost a tenth of respondents
answered circular immigration. Likewise, few of respondents in Muang Mukdahan district
answered long-term immigration with all family members and one respondent expressed
circular immigration. Correspondingly, more than a fifth of respondents in Maesod district
engage long-term immigrant labor with all family members. A fifth of respondents employ
immigrant labor with circular movement and a few of respondents hire seasonally
immigrant labor. Chi-Square test is applied to the above table to understand the similarities
and differences of cross-border movement patterns of immigrant labor across Thai border
regions. It is evident that significant differences are observed across Thai border regions as
its p-value indicated significance at 99 % confidence level.
16) Gender ratios of immigrant labor
Table 7.16 below presents gender ratios of immigrant labor.
Table 7.16 Gender ratios of immigrant labor
Gender ratio (%)
men and women labor
None employment of
immigrant labor
50:50
25:75
75:25
100% male labor
100% female labor
Cross-Border Region 1
Tha
Cam
F
%
F %
5
22.7
0
0
10
3
2
2
0
45.5
13.6
9.1
9.1
0
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
24
80
0
0
0
0
0
0
0
0
0
0
0
0
2
2
2
0
0
Total
22
100
0
Fisher-Exact Test
p-value
Source: Field survey during 2009-2012.
30
6.7
6.7
6.7
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
7.5
0
0
0
0
0
0
0
0
0
0
0
0
10
3
12
24
1
18.5
5.6
22.2
44.4
1.9
0
0
0
0
0
0
0
0
0
0
100
0
0.000
54
100
proportion of men and women and less than a tenth hire men and women at the proportion
of 25%:75%. One respondent engages 100% female immigrant labor. Fisher Exact test is
applied to the above table to understand similarities and differences of gender ratios of
immigrant labor across Thai border regions. It is evident that significant differences are
observed across Thai border regions as its p-value indicated significance at 99%
confidence level.
17) Positive impacts of immigrant labor
Table 7.17 below presents the positive impacts of immigrant labor.
Table 7.17 Positive impacts of immigrant labor
Type of impact
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
4
13.3 0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
21
38.8 0
0
11
36.6
20
37
10
11.1
6.6
5.5
1.8
0
0
10
30
33.3
100
0
0
0
0
3
54
5.5
100
0
0
0
0
Cross-Border Region 1
Tha
Cam
F
%
F %
4
17.4
0 0
1. Substitute for
shortage of Thai
labor
2. Access to cheap
7
30.4
0
labor
3. Reduce labor
9
40.9
0
cost
4. Increase
1
4.3
0
competitiveness
5. Contribute to
1
4.3
0
local economy
6. No response
0
0
0
Total
22
100
0
Source: Field survey during 2009-2012.
The positive impacts of immigrant labor vary very much across the border districts. The
66.70%, 94.50% and 100% of respondents in Muang Mukdahan, Maesod and
Aranyaprathet districts, respectively, informed of immigrant labor having positive impacts.
Ranging from 30.40% to 37% of respondents across Thai border districts expressed that
cheap labor are accessible from bordering districts. For comparative analysis, 2 fifth of
respondents in Aranyaprathet district replied that the impact for them is reduction of labor
cost. Almost a fifth of respondents stated that immigrant labor are substituting the
shortages of local Thai labor force. There are very few respondents who answered that
immigrant labor are increasing business competitiveness, as well as contributing to local
economic growth. In comparison, more than a third of respondents in Muang Mukdahan
district informed of accessibility of cheap labor and more than a tenth told that immigrant
labor are substituting shortages of local Thai labor force. A tenth of respondents indicated
reduction of labor cost and a third did not have any response at all. Furthermore, almost 2
fifth of respondents in Maesod district mentioned either substituting shortages of local Thai
labor force or accessibility of cheap labor. Slightly more than a tenth of respondents
answered reduction of labor cost, a few stated that immigrant labor are increasing business
competitiveness, and one respondent replied that immigrant labor are contributing to local
economic growth. A few of respondents have no response at all.
96
Cross-Border Region
Cross-Border Region 2
Cross-Border Region
1
Tha
Cam
F
%
F %
9
40.9 0 0
Tha
Lao
Cross-Border Region
3
Tha
Mya
F
%
F %
0
0
0 0
F
1
%
3.3
F
0
%
0
10
14.8
0
0
0
0
1
1
24
30
3.3
3.3
80
100
0
0
0
0
0
0
0
0
22
9
15
54
40.7
16.6
27.7
100
0
0
0
0
0
0
0
0
The negative impacts of immigrant labor vary much across Thai border districts.
Respondents in Muang Mukdahan (20%), Aranyaprathet (68.20%) and Maesod (72.30%)
districts stated that immigrant labor have various negative impacts. For comparative
analysis, 2 fifth of respondents in Aranyaprathet district replied that immigrant labor are
likely to create social and environmental problems. More than a tenth of respondents
expressed that they are likely to commit crime and almost a tenth of respondents told that
immigrant labor are likely to carry communicable diseases. Only a very small proportion
of respondents revealed that immigrant labor can displace local labor and almost a third of
respondents have no response at all. Also, a tenth of respondents in Muang Mukdahan
district stated that immigrant labor are likely to commit crime. There are very few
respondents who expressed that immigrant labor are likely to create social and
environmental problems; carrier of communicable diseases or they may displace local
labor, while 4 fifth of respondents have no response at all. Likewise, 2 fifth of respondents
in Maesod district indicated that immigrant labor are likely to carry communicable diseases
and slightly more than a tenth of respondents replied that they may displace local labor.
Less than a tenth of respondents answered that they are likely to commit crime and slightly
more than a quarter have no response at all.
19) Cross-border transit trade
Respondents across Thai border districts, namely, in Maesod (5.60%), Muang Mukdahan
(16.60%) and Aranyaprathet (22.70%) districts perform cross-border transit trade
activities. Also, slightly more than a quarter of respondents in Kaysone Phomvihane
district of Lao PDR conduct cross-border trade activities. In contrast, all of respondents in
both OChrov district of Cambodia and Myawaddy district of Myanmar do not involve in
cross-border transit trade activity at all.
For comparative analysis, almost a quarter of respondents in Aranyaprathet district of
Thailand perform transit trade with Vietnam. Likewise, a tenth of respondents in Muang
Mukdahan district of Thailand make transit trade with Vietnam. There are very few
respondents who carry out transit trade with either Japan or USA. Also, a quarter of
respondents in Kaysone Phomvihane district of Lao PDR arrange transit trade with
97
Cross-Border Region 1
Tha
Cam
F
%
F %
1. None
17
77.3 0 0
2. Vietnam
5
22.7 0 0
3. Malaysia
0
0
0 0
4.Bangladesh
0
0
0 0
5. Japan
0
0
0 0
6. China
0
0
0 0
7. USA
0
0
0 0
Total
22
100
0 0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
25
83.3
22
73.3
3
10
8
26.7
0
0
0
0
0
0
0
0
1
3.3
0
0
0
0
0
0
1
3.3
0
0
30
100
30
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
51
94.4
0
0
0
0
0
0
1
1.9
0
0
1
1.9
0
0
1
1.9
0
0
0
0
0
0
0
0
0
0
54
100
0
0
Cross-Border Region 1
Tha
Cam
(Road)
(Road)
F
%
F
%
3
13.6
3
20
8
36.4
12
80
7
31.8
0
0
4
18.2
0
0
22
100
0
0
Excellent
Good
Moderate
Poor
Total
FisherExact Test
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
(Bridge)
(Bridge)
F
%
F
%
7
23.3
30 100
23
76.7
0
0
0
0
0
0
0
0
0
0
30
100
30 100
0.000
Cross-Border Region 3
Tha
Mya
(Bridge)
(Bridge)
F
%
F
%
2
3.7
0
0
36
66.7
6
20
11
20.4
21
70
5
9.3
3
10
54
100
30 100
Cross-Border Region 1
Tha
Cam
F
%
F
%
Excellent
3
13.6
0
0
Good
9
40.9
11
73.3
Moderate
9
40.9
2
13.3
Poor
1
1.5
2
13.3
Total
22
100
15
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
1
3.3
0
0
20
66.7
30 100
9
30
0
0
0
0
0
0
30
100
0
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
3
5.6
0
0
29
53.7
0
0
21
38.9
19
63.3
1
1.9
11
36.7
54
100
30
100
With regard to border financial services, border banking services in Thailand are well
developed than those counterpart bordering districts. This is reflected by the excellent
satisfaction of respondents across Thai border districts of Muang Mukdahan (3.30%),
Maesod (5.60%) and Aranyaprathet (13.60%). For comparative analysis, 2 fifth of
respondents in Aranyaprathet district of Thailand reported either good or moderate
satisfaction and one respondent replied poor satisfaction. Whereas almost 3 quarters of
respondents in OChrov district of Cambodia expressed good satisfaction, more than a
tenth of respondents expressed either moderate or poor satisfaction.
For comparison, 2 third of respondents in Muang Mukdahan district of Thailand expressed
good satisfaction in the financial services and almost a third of respondents indicated
moderate satisfaction. Whereas all of respondents in Kaysone Phomvihane district of Lao
PDR interestingly expressed good satisfaction, this may have resulted from the fact that
Laotian respondents culturally do not like to express any complaint. Correspondingly,
slightly more than half of respondents in Maesod district of Thailand answered good
satisfactions, almost 2 fifth replied moderate satisfaction, and one respondent answered
poor satisfaction. Whereas less than 2 third of respondents in Myawaddy district of
99
Myanmar replied moderate satisfaction, more than a third of respondents answered poor
satisfaction.
22) Perceptions on Border Customs, Immigration and Quarantine (CIQ) services
Table 7.22 below presents perceptions on border customs, immigration and quarantine
services.
Table 7.22 Perceptions on Border Customs, Immigration and Quarantine Services
Perception/
satisfaction
level
Cross-Border Region 1
Tha
Cam
F
%
F
%
Excellent
2
9.1
0
0
Good
13
59.1
13
86.7
Moderate
7
31.8
2
13.3
Poor
0
0
0
0
Total
22
100
0
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
3
10
0
0
16
53.3
30 100
11
36.7
0
0
0
0
0
0
30
100
0
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
7.4
0
0
34
63
0
0
15
27.8
19
63.3
1
1.9
11
36.7
54
100
30
100
In relation to cross-border trade facilitation, border CIQ services in Thailand are also well
developed than counterpart bordering districts. This is reflected by the excellent
satisfaction of respondents across Thai border cities of Maesod (7.40%), Aranyaprathet
(9.10%) and Muang Mukdahan (10%). For comparative analysis, more than half of
respondents in Aranyaprathet district of Thailand indicated good satisfaction and almost a
third of respondents said they are moderately satisfied. Whereas most of respondents in
OChrov district of Cambodia answered good satisfaction, more than a tenth of
respondents told that they are moderately satisfied. Also, more than half of respondents in
Muang Mukdahan district of Thailand expressed good satisfaction and more than a third of
respondents replied that they are moderately satisfied. Whereas all of respondents in
Kaysone Phomvihane district of Lao PDR once again expressed good satisfaction, this may
also have resulted from the fact that Laotian respondents typically do not like to make any
complaint. Likewise, more than 3 fifth of respondents in Maesod district of Thailand
indicated good satisfaction, more than a quarter answered moderate satisfaction, and one
respondent informed of poor satisfaction. Whereas 2 third of respondents in Myawaddy
district of Myanmar replied moderate satisfaction, a third of respondents answered poor
satisfaction.
7.2 Key Findings and Reflections
Cross-border trading is mostly undertaken by local border residents across the cross-border
regions. Most of the cross-border trader respondents across the regions are family based
businesses and mainly small and medium-sized enterprises (SMEs). The duration of
operation of the establishments across the regions is 11 years to13 years. Thai goods are
widely accepted among bordering countries due to high quality standards and reasonable
prices. Cross-border exported commodities across the Thai border districts are quite
similar, mainly consisting of consumer goods, intermediate and capital goods, whereas
cross-border imported commodities from bordering districts are mostly agricultural
commodities. There are strong supply chain linkages between Thai border districts with
Bangkok metropolis and its vicinity and vice versa. However, cross-border traded goods
are mainly produced in Bangkok metropolis and its vicinity such as eastern region and
other centers. At present, Thai border cities and towns mainly play distribution role and
100
cross-border traders play important role in promoting cross-border supply chain linkages.
Thai goods hold a large market share at the varying range of 38% to 77% of total traded
commodities across the cross-border regions. Collectively, ASEAN goods hold high
market share in the range of 78.30% to 100% across the regions.
As a matter of convenience, payment by cash is widely adopted across the cross-border
regions. Cross-border trader respondents across the bordering districts engaged a higher
number of local labor, with 12 to 41 workers mainly for loading and unloading activities,
whereas, respondents across Thai border districts have employed lower number of local
and immigrant labor of 7 to 10 workers. Only respondents across the Thai border districts
employed immigrant labor of 5 to 9 workers. The daily wage rates across the Thai border
districts are approximately 3 times higher than counterpart bordering districts. Respondents
across Thai border districts of Maesod (5.60%), Muang Mukdahan (16.60%) and
Aranyaprathet (22.70%) have conducted cross-border transit trade with Vietnam.
Improvement of cross-border connectivity (e.g., roads and international river bridges)
significantly facilitated cross-border trade activities. The respondents perceived that border
banking and Customs, Immigration and Quarantine (CIQ) services across the border
districts of Thailand are noticeably well-organized than the counterpart bordering districts.
This chapter reflects the characteristics and flows of strategic trading commodities of local
origin that contribute to the large-scale cross-border trade between Thailand and bordering
countries of Cambodia, Lao PDR and Myanmar. The chapter also has identified the
linkages of local cross-border trade with regional, national and cross-border production
networks. It has explained the current logistics and supply chains, and trade facilitation
practices of cross-border trade and cross-border transit trade. It is obvious that
geographical and comparative advantages associated with contributing factors have upheld
the studied border cities between Thailand and bordering countries towards becoming vital
cross-border trade regions, which are relied upon for livelihoods by a large number of local
residents. Therefore, local large-scale cross-border trading plays an important role in
establishing networks of commodities flowing both locally and nationally, as well as
contributing to rapid growth of local and cross-border economy. As a result, the Thai
border cities have been evolving into newly peripheral growth centers and increasingly
performing important role in the national urban hierarchy. Finally, the preceding findings
and reflections support the hypothesis stating that cross-border trade regions are expected
to gain infrastructural, economic, and service benefits at the regional scale due to
production and trading linkages.
101
CHAPTER 8
LOCAL BORDER WHOLESALING, RETAILING
AND CROSS-BORDER SHOPPING ACTIVITIES
This chapter highlights local border wholesaling and retailing activities and trader
entrepreneurships. It also includes cross-border shopping and behaviors of shoppers. The
characteristics of local border trade and cross-border shopping are presented in the
following sections.
8.1 Local Border Wholesaling
The distinctive features of local border wholesaling are as follows:
1) Registrations of wholesaling businesses
Table 8.1 below exhibits border wholesaling business registrations in three cross-border
regions.
Table 8.1 Registrations of border wholesaling businesses
Type of registration
Cross-Border Region 1
Tha
Cam
F
%
F
%
0
0
0
0
29
96.6
0
0
0
0
15
100
None
Merchant shop
Tax payer
registration
Partnership limited
1
3.4
0
0
Ordinary partnership
0
0
0
0
Company limited
0
0
0
0
Non-governmental
0
0
0
0
organization
Total
30
100
15
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
0
0
27
90
30
100
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
3
0
0
22
66.6
30 100
0
0
0
0
1
0
2
0
3.3
0
6.6
0
0
0
0
0
0
0
0
0
6
2
1
1
18
6
3
3
0
0
0
0
0
0
0
0
30
100
30
100
33
100
30
100
102
Fisher Exact test is applied to the above table to understand similarities and differences of
the duration of operation of business establishments between three cross-border regions. It
is evident that significant differences are observed in two cross-border regions
(Aranyaprathet district of Thailand and OChrov district of Cambodia and Muang
Mukdahan district of Thailand and Kaysone Phomvihane district of Lao PDR) as its
p-value indicated significance at 90% confidence level. On the other hand, there is no
significant difference in the cross-border region of Maesod district of Thailand and
Myawaddy district of Myanmar as shown by its p-value.
3) Wholesale commodities
Table 8.3 presents the wholesale commodities in three cross-border regions.
Table 8.3 Wholesale commodities (Multiple responses)
Commodity
Cross-Border Region
Cross-Border Region 1
Cross-Border Region 2
Tha
Cam
Tha
Lao
F
%
F
%
F
%
F
%
1. Consumer goods
3
9
5
33.3
12
35.2
8
18.6
2. Cosmetics
0
0
1
6.6
0
0
3
6.9
3. Food products
5
15.1
0
0
3
8.8
0
0
4. Electric appliances
1
3
0
0
2
5.8
3
6.9
5. Brand-new clothes
9
27.2
2
13.3
7
20.5
17
39.5
6. Brand-new shoes
2
6
0
0
0
0
4
9.3
7. Fruits and
1
3
0
0
0
0
0
0
vegetables
8. Kitchenwares
4
12.1
1
6.6
6
17.6
2
4.6
9. Construction
0
0
4
26.6
0
0
1
2.3
materials
10. Fuel and cooking
0
0
0
0
0
0
0
0
gas
11. Sparepart of
0
0
1
6.6
1
2.9
3
6.9
motorcycle and bicycle
12. Agricultural
0
0
0
0
0
0
0
0
produces
13. Woods and
0
0
0
0
2
5.8
0
0
handicraft products
14. Recycled products
0
0
0
0
0
0
0
0
15. Jewelry
5
15.1
0
0
0
0
0
0
16. Furniture
0
0
0
0
0
0
0
0
17. IT products
1
3
0
0
0
0
0
0
18. Stationery
1
3
0
0
0
0
0
0
19. Antique objects
0
0
1
6.6
0
0
0
0
20. Souvenirs
0
0
0
0
1
2.9
0
0
21. Liquor and
0
0
0
0
0
0
1
2.3
beverage
22. Phamaceutical and
0
0
0
0
0
0
1
2.3
medical apparatus
23. Household goods
1
3
0
0
0
0
0
0
Total
33
100
15
100
34
100
43
100
Source: Field survey during 2009-2012.
Cross-Border Region 3
Tha
Mya
F
%
F
%
6
18.7
12
33.3
2
6.2
0
0
5
15.6
1
3
3
9.3
1
2.9
0
0
5
14
0
0
0
0
0
0
0
0
6
0
18.7
0
0
2
0
5.4
3.1
3.1
8.3
8.3
2
1
1
0
0
0
0
4
6.2
3.1
3.1
0
0
0
0
12.5
0
0
0
0
0
0
0
5
0
0
0
0
0
0
0
13.5
0
32
0
100
3
36
8.3
100
Respondents across the cross-border regions sell a wide range of essential commodities.
Respondents in the 4 border districts, namely, Maesod district of Thailand (18.70%),
104
enterprises. Very few of respondents secure goods from either regional wholesalers or
cross-border community-based enterprises. Likewise, a tenth of respondents in OChrov
district of Cambodia also obtain goods from manufacturers in Bangkok metropolis and its
vicinity in Thailand. Almost 2 fifth of respondents obtain goods from cross-border
wholesalers and almost a quarter procure from wholesalers in Phnom Penh. More than a
tenth of respondents gain goods from manufacturers in Phnom Penh and one respondent
acquires from either regional wholesalers, local wholesalers, or produces by own business.
Likewise, more than a third of respondents in Muang Mukdahan district of Thailand
procure from cross-border wholesalers in Kaysone Phomvihane district of Lao PDR.
Table 8.4 Sources of procurement (Multiple responses)
Sourcing
Cross-Border Region 1
Tha
Cam
F
%
F
%
2
5.6
0
0
1.Local community
enterprise
2.Local wholesalers
7
19.4
1
3.2
3.Regional
1
2.8
1
3.2
wholesalers
4.Wholesalers in
16
44.4
7
22.6
capital city
5.Cross-border
5
13.9
12
38.7
wholesalers
6.Cross-border
0
0
0
0
wholesalers in
capital city
7.Local
0
0
0
0
manufacturers
8.Cross-border
0
0
4
12.9
manufacturers in
Bangkok
metropolis/
bordering city
9.Regional
0
0
0
0
manufacturers
10.Manufacturers
3
8.3
5
16.1
in capital city
11.Produced by
1
2.8
1
3.2
their own business
12.Cross-border
1
2.8
0
0
community-based
enterprises
13.Cross-border
0
0
0
0
importers
Total
36
100
31
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
2
4.3
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
2.3
0
0
3
1
6.4
2.1
6
0
11.1
0
4
0
9.3
0
0
4
0
11.4
8.5
15
27.8
2.3
14.3
17
36.2
23
42.6
11.6
26
74.3
14.8
4.7
4.7
2.1
17
36.2
28
65.1
4.3
3.7
30
100
54
100
43
100
35
100
Almost a tenth of respondents purchase from wholesalers in Bangkok metropolis and its
vicinity and a few of respondents obtain from local wholesalers. A few of respondents
acquire from either their own businesses or local community-based enterprises and very
lfew buy from either regional wholesalers or regional manufacturers. Also, more than a
quarter of respondents in Kaysone Phomvihane district of Lao PDR acquire from either
106
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
27
46.6
29
42
6
10.3
16
23.2
0
0
0
0
11
19
6
8.7
0
0
0
0
1
1.7
0
0
0
0
0
0
0
0
0
0
12
20.7
18
26.1
0
0
0
0
58
100
69
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
30
63.8
28
80
0
0
0
0
0
0
0
0
1
2.1
0
0
3
6.4
0
0
5
10.6
7
20
2
4.3
0
0
1
2.1
0
0
4
8.5
0
0
0
0
0
0
47
100
35
100
Ranging from 46.60% to 80% of respondents across the cross-border regions obtain goods
from Thailand. Respondents (7.70% to 20.70%) across Thai border districts distribute
goods that originated from China. For comparative analysis, more than half of goods sold
in both Aranyaprathet district of Thailand and OChrov district of Cambodia are made in
Thailand. Almost a fifth of respondents in Aranyaprathet district of Thailand expressed
that their goods are coming from Myanmar, and a few stated that their goods originate
from China. There are very few respondents who informed that their goods originate either
from Vietnam or India. On the contrary, less than half of respondents in OChrov district
of Cambodia answered that goods are produced in Cambodia and one respondent stated
that goods originate from Vietnam.
Likewise, less than half of respondents in both Muang Mukdahan district of Thailand and
Kaysone Phomvihane district of Lao PDR informed that goods are made in Thailand. A
fifth of respondents in Muang Mukdahan district of Thailand replied that goods are
107
produced either in China or Vietnam. A tenth of respondents expressed that goods are
made in Lao PDR and one respondent stated that goods originate from Myanmar. Whereas
slightly more than a quarter of respondents in Kaysone Phomvihane district of Lao PDR
stated that goods are made in China, almost a quarter of respondents told that goods
originate from Lao PDR. A few of respondents said that goods are made in Vietnam.
Correspondingly, more than 3 fifth of respondents in Maesod district of Thailand and 4
fifth of respondents in Myawaddy district of Myanmar acquire goods originating from
Thailand. A tenth of respondents in Maesod district of Thailand gain goods produced in
Myanmar and less than a tenth of respondents obtain goods produced in either China or
Malaysia. Few of respondents trade goods produced in the Philippines and one respondent
sells goods made in either Vietnam or Indonesia. Moreover, a fifth of respondents in
Myawaddy district of Myanmar sell goods originating from Myanmar.
6) Employment of labor
Table 8.6 below presents employment of labor in three cross-border regions.
Table 8.6 Employment of labor
Number of labor
Cross-Border Region 1
Tha
Cam
F
%
F
%
19
63.3
10
67
5
16.6
5
33
6
20
0
0
0
0
0
0
30
100
15 100
7
3
2.9
9
Self-employed
5 workers
5-15 workers
>15 workers
Total
Average
Standard
deviation
Fisher Exact Test
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
13
43.3
20
60.6
12
40
11
33.3
4
13.3
2
6.1
1
3.3
0
0
30
100
33
100
5
4
6
3
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
11
36.7
10
30.3
17
56.7
13
39.4
2
6.7
10
30.3
0
0
33
100
30
100
14
4
13.5
1
0.000
108
Also, the average number of labor employed in both Muang Mukdahan district of Thailand
and Kaysone Phomvihane district of Lao PDR are almost comparable with 4 to 5 workers.
Two fifth of respondents in Muang Mukdahan district of Thailand hire less than 5 local
and immigrant workers. More than a tenth of respondents engage 5 to 15 local and
immigrant workers and one respondent engages more than 15 local and immigrant
workers. Similarly, a third of respondents in Kaysone Phomvihane district of Lao PDR
employ less than 5 local workers and few of respondents engaged 5 to 15 local workers.
Correspondingly, respondents in Maesod district of Thailand hire the highest average
number of 14 local and immigrant workers, higher than those counterpart respondents in
Myawaddy district of Myanmar who employ an average of 4 local workers. More than a
third of respondents in Maesod district of Thailand hire 5 to 15 local and immigrant
workers and almost a third of respondents employ either less than 5 local and immigrant
workers or more than 15 local and immigrant workers. Likewise, more than half of
respondents in Myawaddy district of Myanmar employ fewer than 5 local workers and few
of respondents engage 5 to 15 local workers. Fisher Exact test is applied to the above table
to understand the similarities and differences of labor employment between cross-border
regions. It is evident that significant differences are observed across the cross-border
regions as its p-value indicated significance at 99% confidence level.
7) Employment of immigrant labor
Table 8.7 below presents employment of immigrant labor in three cross-border regions.
Cross-Border Region 1
Tha
Cam
F
%
F
%
19 63.3 0
0
5
16.6 0
0
6
20
0
0
0
0
0
0
30
100
0
0
7
3
None
<5 workers
5-15 workers
>15workers
Total
Mean
Standard deviation
Fisher Exact
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
17
56.7
0
0
10
33.3
0
0
3
10
0
0
0
0
0
0
30
100
0
0
6
2.7
0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
0
0
11
33.3 0
0
19
66.7 0
0
0
0
0
0
33
100
0
0
8
7.9
Cross-Border Region 1
Tha
Cam
F
%
F
%
19
63.3
10
66.7
0
0
1
6.7
10
33.3
4
26.7
1
3.3
0
0
30
100
15
100
113
58
28
16
None
50 Baht
50-150 Baht
>150 Baht
Total
Mean
Standard
deviation
Fisher Exact Test
0.69
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
17
56.6
20
60.6
0
0
5
15.2
7
23.3
8
24.2
6
20.0
0
0
30
100
33
100
109
50
44
19
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
11
36.7
1
3
7
23.3
26
78.8
12
40
6
18.2
0
0
33
100
30
100
118
51
37
19
0.069
0.000
In 2011, the official minimum daily wage rates for Thai citizens in Thai border provinces
of Sakaeo, Mukdahan and Tak are set at 173 Baht, 165 Baht and 162 Baht, respectively.
While the respondents across Thai border districts offer immigrant labor with daily wage
rate of 109 Baht to 118 Baht which is slightly lower than the official minimum daily wage
rate, respondents across the bordering districts pay local daily wages ranging from 50 Baht
to 58 Baht. This means the average daily wage rates across Thai border districts are
roughly 2 to 3 times higher than in the counterpart bordering districts. For comparative
analysis, a third of respondents in Aranyaprathet district of Thailand pay 50 Baht to 150
Baht to Cambodian immigrant labor. One respondent remunerates Cambodian immigrant
labor higher than 150 Baht. On the contrary, slightly more than a quarter of respondents in
OChrov district of Cambodia remunerate with local daily wage rate of 50 Baht to 150
Baht. One respondent pays local labor lower that 50 Baht per day. Also, almost a quarter of
respondents in Muang Mukdahan district of Thailand compensate 50 Baht to 150 Baht per
day to Laotian immigrant labor and one fifth of respondents pay Laotian immigrant labor
more than 150 Baht. Whereas almost a quarter of respondents in Kaysone Phomvihane
district of Lao PDR remunerate with local daily wage rates of 50 Baht to 150 Baht, more
than a tenth of respondents compensate with less than 50 Baht per day.
Correspondingly, more than 3 quarters of respondents in Maesod district of Thailand pay
daily wages of 50 Baht to 150 Baht to Burmese immigrant labor. Almost a fifth of
respondents compensate Burmese immigrant labor with higher than 150 Baht per day. A
110
respondent pays Burmese immigrant labor with less than 50 Baht per day. While 2 fifth of
respondents in Myawaddy district of Myanmar pay local wages of 50 Baht to 150 Baht,
almost a quarter of respondents compensate with local daily wage of less than 50 Baht.
Fisher Exact test is applied to the above table to understand the similarities and differences
of the daily wage rates of local and immigrant labor between cross-border regions. It is
evident that significant difference are observed in two cross-border regions of (1) Muang
Mukdahan district of Thailand and Kaysone Phomvihane district of Lao PDR and (2)
Maesod district of Thailand and Myawaddy district of Myanmar as its p-value indicated
significance at 90% and 99% confidence level, respectively. But, there is no significant
difference in the cross-border region of Aranyaprathet district of Thailand and OChrov
district of Cambodia as indicated by its p-value.
9) Reasons for employing immigrant labor
Table 8.9 below describes reasons for employing immigrant labor across Thai border
regions.
Table 8.9 Reasons for employing immigrant labor
Reason
Cross-Border Region 1
Tha
Cam
F
%
F
%
19 63.3
0
0
1. None employment
of immigrant labor
2. Local Thai labor
2
6.6
0
force is choosy with
jobs.
3. Shortage of Thai
0
0
0
labor force in their
city
3. Immigrant labor in
7
23.3
0
their city is cheap, so
they can reduce
managerial cost
4. Competent
2
6.6
0
communication of
neighboring
countrys language
Total
30
100
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
17
56.6
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
0
0
10
33
27.2
6.6
20
60.6
3.3
30
100
33
100
Reasons for employing immigrant labor really vary across Thai border districts.
Respondents who replied that immigrant labor in their city is cheap and so they can reduce
managerial cost are represented by 6.60%, 23.30% and 60.60% in Muang Mukdahan,
Aranyaprathet and Maesod districts, respectively. For comparative analysis, a few of
respondents in Aranyaprathet district answered either local Thai labor force is choosy with
jobs or immigrant labor are competent in communicating the bordering Cambodian
language. Also, a third of respondents in Muang Mukdahan district indicated that local
Thai labor force is selective with jobs. A respondent expressed that immigrant labor are
competent in communication of bordering Laotian language. Likewise, a quarter of
respondents in Maesod district answered that local Thai labor force are choosy with jobs.
A tenth of respondents indicated that there is shortage of Thai labor in Maesod district.
111
Very few of respondents rely on immigrant labor because they are competent in
communication of bordering Burmese language.
10) Cross-border movement patterns of immigrant labor
Cross-border movement patterns of immigrant labor significantly vary across Thai border
districts depending on whether there is an existing favorable labor movement policy or not.
Table 8.10 below presents cross-border movement patterns of immigrant labor.
Table 8.10 Cross-border movement patterns of immigrant labor
Cross-border
movement pattern
Cross-Border Region 1
Tha
Cam
F
%
F
%
19
63.3 0
0
7
23.3 0
0
1
3.3
0
0
1
3.3
0
0
2
6.6
0
0
1. None employment
2. Daily
3. Seasonal
4. Circular
5. Long-term
immigration with all
family members
Total
30
100
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
17
56.6 0
0
0
0
0
0
5
16.5 0
0
1
3.3
0
0
7
23.1 0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
0
0
2
6
0
0
1
3
0
0
9
27.2 0
0
21
63.6 0
0
30
33
100
100
In this case, Thailand unilaterally permits daily movement of immigrant labor particularly
for Cambodian nationals using Aranyaprathet as a pilot border checkpoint. As shown in the
table, less than a fifth of respondents in Aranyaprathet district expressed daily movement.
A few of respondents stated long-term immigration with all family members. Only a very
small proportion of respondents revealed either seasonal or circular immigration. While
almost a quarter of respondents in Muang Mukdahan district expressed long-term
immigration with all family members, less than a fifth of respondents stated seasonal
immigration, and one respondent revealed circular immigration. Correspondingly, more
than 3 fifth of respondents in Maesod district answered long-term immigration with all
family members. More than a quarter of respondents replied circular migration and less
than a tenth of respondents informed of daily cross-border movement. One respondent
expressed seasonal cross-border movement.
11) Positive impacts of employing immigrant labor
Table 8.11 presents the positive impacts of immigrant labor across Thai border regions.
The positive impacts of immigrant labor greatly vary across Thai border districts.
Respondents across Thai border districts of Maesod (27.20%), Muang Mukdahan (36.60%)
and Aranyaprathet (70%) expressed that immigrant labor are accessible and cheap. For
comparative analysis, very few of respondents in Aranyaprathet district stated that
immigrant labor are either substituting the shortages of local Thai labor force; reducing
labor cost, or contributing to local economic growth. A fifth of respondents have no
response at all. Similarly, more than a third of respondents in Muang Mukdahan district
informed that immigrant labor are substituting the shortages of local Thai labor force and
more than a tenth of respondents told that they are reducing the labor cost. A tenth of
respondents have no response at all. Likewise, almost a third of respondents in Maesod
district replied reducing labor cost and almost a fifth replied substituting shortages of
local Thai labor force. There are very few respondents who stated that immigrant labor are
increasing business competitiveness and a fifth of respondents have no response at all.
112
1. Substitute shortage
of Thai labor
2. Access to cheap
21
70
0
labor
3. Reduce labor cost
1
3.3
0
4. Increase
competitiveness
0
0
0
5. Contribute to local
economic growth
1
3.3
0
6. No response
6
20
0
Total
30
100
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
11
36.6 0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
6
18.1 0
0
11
36.6
27.2
13.3
10
30.3
3.3
0
0
0
0
3
30
0
10
100
0
0
0
0
0
0
0
7
33
0
21.2
100
0
0
0
0
0
0
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
1
3.3
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
0
0
10
18.1
0
0
0
0
1
1
24
30
3.3
3.3
80
100
0
0
0
0
0
0
0
0
12
6
7
31
36.3
18.1
21.2
100
0
0
0
0
0
0
0
0
The negative impacts of immigrant labor also significantly vary across Thai border
districts. Ranging from 20% to 80% of respondents across Thai border districts disclosed
all kinds of negative impacts of immigrant labor. For comparative analysis, more than half
of respondents in Aranyaprathet district informed that immigrant labor are likely to commit
crime. Less than a fifth of respondents told that immigrant labor are likely to either create
social and environmental problems or carry communicable diseases. A respondent stated
that immigrant labor are displacing the local labor. Also, a tenth of respondents in Muang
Mukdahan district stated that they are likely to commit crime. Very few of respondents
expressed that immigrant labor are either likely to create social and environmental
problems, carrier of communicable diseases, or displacing local labor.
Correspondingly, more than a third of respondents in Maesod district replied likely to
carry communicable diseases and almost a fifth of respondents answered either
displacing local labor or likely to commit crime.
113
8.2 Local Border Retailing The specific features of border retailing are as follows:
1) Registration of businesses
Registrations of business slightly vary across the cross-border regions. Ranging from 40%
to 93.80% of respondents across the 5 border districts do not register at all, which means
they are being informal retailers. On the other hand, most of respondents in Kaysone
Phomvihane district of Lao PDR register as tax payer. For comparative analysis, few of
Thai respondents in Aranyaprathet district of Thailand register their business as merchant
shop. Table 8.13 presents registrations of retailing businesses in three cross-border regions.
Table 8.13 Registrations of businesses
Type of
registration
Cross-Border Region 1
Tha
Cam
F
%
F
%
45
93.8
24
77.4
3
6.3
0
0
0
0
7
22.6
0
0
0
0
None
Merchant shop
Tax payer
Partnership
limited
Total
48
100
31
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
38
66.6
3
9.1
18
31.5
0
0
0
0
30
90.9
1
1.7
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
12
40
23
76.6
18
60
7
23.3
0
0
0
0
0
0
0
0
57
30
100
33
100
100
30
100
115
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
2
3
7
20.5
4
6
2
5.8
10
14.9
0
0
2
3
4
11.7
27
40.3
11
32.3
1
1.5
0
0
2
3
4
11.7
1
1.5
0
0
0
0
0
0
0
0
0
0
0
0
0
0
7
10.4
2
5.8
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
3
8.3
8
21.6
0
0
1
2.7
5
13.9
0
0
1
2.8
1
2.7
9
25
14
37.8
0
0
0
0
2
5.6
3
8.1
1
2.8
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4
11.1
2
5.4
0
0
1
2.7
2.4
2.4
2.4
0
0
0
0
0
0
0
1
2
1
1
0
0
0
1.5
3
1.5
1.5
0
0
0
1
1
0
0
0
0
0
2.9
2.9
0
0
0
0
0
0
5
0
0
0
0
0
0
13.9
0
0
0
0
0
0
0
1
0
0
0
0
0
0
2.7
0
0
0
4
2
6
3
0
0
0
2.9
0
0
0
0
0
0
0
0
1.5
2.9
2.83
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
1
0
0
0
0
0
0
0
0
0
1
3
1
0
0
2.8
8.3
2.8
0
1
1
2
0
1
2.7
2.7
5.4
0
2.7
2.7
100
67
100
34
100
36
100
37
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
1.9
2
4.8
1
1.9
4
9.5
1
1.9
0
0
1
1.9
2
4.8
14
26.9
11
26.2
17
32.7
1
2.4
4
7.7
5
11.9
4
7.7
2
4.8
1
1.9
0
0
1
1.9
0
0
3
5.8
6
14.3
4
7.7
0
0
0
0
3
7.1
1. Consumer goods
2. Cosmetics
3. Food products
4. Electric appliances
5. Brand-new clothes
6. Secondhand clothes
7. Brand-new shoes
8. Secondhand shoes
9. Brand-new leather
10.Secondhand leather
11.Fashion accessories
12. Kitchenwares
13. Liquor and
beverage
14. Cigar
0
0
1
15. Glass and watch
0
0
1
16. Bedding
0
0
1
17. Toys
0
0
0
18. Jewelry
0
0
0
19. Wood products
0
0
0
20. Spare parts of
0
0
0
motorcycles and
bicycles
21. Forest products
0
0
0
22. Dry fresh water
0
0
0
fishes
23. Fruits and
0
0
0
vegetables
24. Machines
0
0
0
25. IT products
0
0
0
26. Home decoration
0
0
0
27. Stationery
0
0
0
28. Construction
0
0
0
materials
29. Agricultural
0
0
0
produce
Total
52
100
42
Source: Field survey during 2009-2012.
Aranyaprathet and OChrov districts sell almost similar products. Only a very small
proportion of Thai respondents in Aranyaprathet district of Thailand trade either brandnew clothes, fashion accessories, second-hand leather, or consumer goods. Concerning
Cambodian border retailers, more than a third of respondents retail second-hand clothes.
More than a quarter of respondents trade brand-new clothes and less than a tenth of
respondents vend either brand-new shoes, second-hand shoes, or kitchenware. Few of
respondents retail fashion accessories and there are very few who sell either brand-new
leather, food products, electric appliances, or cosmetics. Similarly, slightly more than a
quarter of respondents in OChrov district of Cambodia retail brand-new clothes and more
116
than a tenth sell fashion accessories. Slightly more than a tenth of respondents vend brandnew shoes and a few retail either liquor or beverages or cigar. Few of respondents sell
either second-hand clothes, glasses and watches, beddings, or toys.
Also, respondents in both Muang Mukdahan district of Thailand and Kaysone Phomvihane
district of Lao PDR sell similar kinds of products. Two fifth of respondents in Muang
Mukdahan district of Thailand sell brand-new clothes. More than a tenth of respondents
trade food products, a tenth vend kitchenwares, and a few retail either cosmetics or forest
products. Few of respondents trade either brand-new shoes, electric appliances, consumer
goods;,dry freshwater fishes, or wood products. There are very few respondents who sell
either second-hand clothes, second-hand shoes, jewelry, spare parts of motorcycle or fruits
and vegetables. Moreover, more than a third of respondents in Kaysone Phomvihane
district of Lao PDR sell brand-new clothes, a fifth trade consumer goods, a tenth vend
either brand-new shoes or electric appliances, and few put on the market either
kitchenwares or cosmetics. Only a very small proportion of respondents sell either
machines, wood products, jewelry, or IT products.
Correspondingly, respondents in both Maesod district of Thailand and Myawaddy district
of Myanmar also sell similar kinds of necessity. More than a third of respondents in
Myawaddy district and a quarter in Maesod district sell brand-new clothes. More than a
tenth of respondents in Maesod district of Thailand sell food products, jewelry or
kitchenwares. Few of respondents trade either second-hand shoes, electric appliances,
stationery, or IT products. Also, there are very few Burmese retailers who vend fruits and
vegetables. Likewise, a tenth of respondents in Myawaddy district of Myanmar retail
brand-new shoes and few sell either kitchenwares, home decorations, or toys. Only a very
small proportion of respondents sell either agricultural produce, electric appliances,
agricultural machines, construction materials, cosmetics, liquor and beverage, IT products,
bicycle or motorcycle and spare parts.
4) Sources of procurement
Sources of procurement considerably vary across the cross-border regions. Ranging from
14% to 61% of respondents across the cross-border regions procure goods from crossborder wholesalers, signifying rather strong existence of cross-border supply chain
linkages. For comparative analysis, 3 fifth of respondents in Aranyaprathet district of
Thailand obtain from cross-border wholesalers in bordering Poipet city of Cambodia. More
than a quarter of respondents acquire from wholesalers in Bangkok metropolis and a tenth
of respondents buy from local wholesalers. One respondent produces by own business.
Also, 2 fifth of respondents in OChrov district of Cambodia procure from wholesalers in
Phnom Penh. Almost 2 fifth of respondents acquire from cross-border wholesalers in
Aranyaprathet district of Thailand. More than a tenth of respondents obtain from crossborder wholesalers in Bangkok metropolis and its vicinity in Thailand. Almost a tenth of
respondents gain from local wholesalers.
Likewise, almost 2 fifth of respondents in Muang Mukdahan district of Thailand procure
from local wholesalers and more than a quarter of respondents purchase from cross-border
wholesalers. Less than a fifth of respondents acquire from wholesalers in Bangkok
metropolis and a tenth of respondents source from local manufacturers. A few of
respondents produce by their own businesses and a few obtain from either local
117
Table 8.16 below presents sources of procurement across three cross-border regions.
Table 8.16 Sources of procurement (Multiple responses)
Sourcing
Cross-Border Region 1
Tha
Cam
F
%
F
%
0
0
0
0
1. Local community
enterprises
2. Local wholesalers
6
10.2
5
9.1
3. Regional
0
0
0
0
wholesalers
4. Wholesalers in
16
27.1
22
40
capital city
5. Cross-border
36
61
21
38.2
wholesalers
6. Cross-border
0
0
7
12.7
wholesalers in capital
city
7. Local
0
0
0
0
manufacturers
8. Manufacturers in
0
0
0
0
capital city
9. Produced by their
1
1.7
0
0
own business
10. Cross-border
0
0
0
0
community-based
enterprises
Total
59
100
55
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
2
2.5
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
2
5.6
0
0
31
2
38.3
2.5
6
2
14
4.7
7
1
19.4
2.8
0
3
0
6.5
13
16
11
25.6
16
44.4
16
34.8
22
27.2
21
48.8
13.9
25
54.3
3.7
9.9
8.3
2.8
4.3
2.8
81
100
43
100
36
100
46
100
118
5) Origins of goods
Goods originating from Thailand possess 30.30% to 69.20% market share across the crossborder regions. For comparative analysis, almost a third of respondents in both
Aranyaprathet district of Thailand and OChrov district of Cambodia procure goods
originating from Thailand. There are very few respondents in both districts who said that
their goods originate either from Indonesia or Japan. A quarter of respondents in
Aranyaprathet district of Thailand informed that their goods are coming from either South
Korea or Hong Kong and a few expressed that their goods originate from either China or
Vietnam. A few of respondents stated that their goods are from Malaysia. In addition,
almost a quarter of respondents in OChrov district of Cambodia gain goods originating
from Cambodia and more than a tenth expressed of goods originating from China. A few
of respondents replied that their goods originate from either South Korea, Japan or
Vietnam. A few of respondents stated that goods originate from either Hong Kong or
Singapore and only a very small proportion of respondents told of goods originating from
either Taiwan, USA, Switzerland, or UK.Table 8.17 below presents origins of goods across
three cross-border regions.
Table 8.17 Origin of goods (Multiple responses)
Country
Cross-Border Region 1
Tha
Cam
F
%
F
%
1. Thailand
24
30.3
26
31
2. Lao PDR
0
0
0
0
3. Cambodia
0
0
19
22.6
4. China
6
7.59
13
15.5
5. Vietnam
5
6.32
5
6
6. Malaysia
3
3.79
1
1.2
7. Myanmar
0
0
0
0
8. Indonesia
1
1.26
1
1.2
9. Singapore
0
0
2
2.2
10. India
0
0
0
0
11. South Korea
20
25.3
6
7.1
12. Hongkong
19
24.0
2
2.2
13. Taiwan
0
0
1
1.2
14. Japan
1
1.26
5
6
15. USA
0
0
1
1.2
16. Switzerland
0
0
1
1.2
17. UK
0
0
1
1.2
Total
79
100
84
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
49
43.2
27
46.6
4
3.5
9
15.5
2
1.8
0
0
31
27.4
12
20.7
19
16.8
10
17.2
0
0
0
0
4
3.5
0
0
1
0.9
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
3
2.7
0
0
0
0
0
0
0
0
0
0
0
0
0
0
113 100
58
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
27
69.2
20
66.6
0
0
0
0
0
0
0
0
3
7.7
0
0
1
2.6
0
0
0
0
0
0
7
17.9
10
33.3
0
0
0
0
0
0
0
0
1
2.6
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
39
100
30
100
Likewise, less than half of respondents both in Muang Mukdahan district of Thailand and
Kaysone Phomvihane district of Lao PDR informed of goods originating from Thailand.
More than a quarter of respondents in Muang Mukdahan district of Thailand replied that
goods originate from China and less than a fifth of respondents expressed that goods
originate from Vietnam. A few of respondents stated that goods are originating from either
Lao PDR or Myanmar and very few said that goods are from either Japan, Cambodia, or
Indonesia. Also, a fifth of respondents in Kaysone Phomvihane district of Lao PDR
informed that goods originate from China and less than a fifth of respondents told that
goods are originating from either Vietnam or Lao PDR.
119
Correspondingly, Thai goods are widely available along Thai and Burmese border as
reflected by 2 third of respondents in both Maesod district of Thailand and Myawaddy
district of Myanmar procuring goods from Thailand. Less than a fifth of respondents in
Maesod district of Thailand stated that goods are originating from Myanmar and less than a
tenth of respondents stated that goods are from China. A few respondents disclosed that
their goods originate from either Vietnam or India, while a third of respondents in
Myawaddy district of Myanmar acquire goods from Myanmar.
6) Employment of labor
Table 8.18 below presents employment of labor across three cross-border regions.Ranging
from 63.30% to 100% of respondents across the cross-border regions are self-employed by
engaging unpaid family members as labor force. Concerning labor employment,
respondents across Thai border districts hire a higher number of labor averaging 3 to 7
local and immigrant workers.
Respondents in the 2 bordering districts engage a lower number of labor averaging 3 and 5
local workers in OChrov district of Cambodia and Kaysone Phomvihane district of Lao
Table 8.18 Employment of labor
Number of
labor
Cross-Border Region 1
Tha
Cam
F
%
F
%
Self38 79.1 29 93.5
employed
5 workers
8
16.6
2
6.5
5-15 workers
2
4.1
0
0
Total
48 100 31 100
Mean
5
3
Standard
3
0
deviation
Fisher Exact
0.29
Test p-value
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
55 96.5 23 76.7
Cross-Border Region 3
Tha
Mya
F
%
F
%
19 63.3 30 100
2
0
57
3
0
5
6
30
7
3.7
3.5
0
100
5
2
30
5
3.3
0.000
16.7
6.7
100
16.7
20
100
0
0
30
0
0
0
0
100
0.000
Fisher Exact test is applied to the above table to understand the similarities and differences
of employment of labor between cross-border regions. It is evident that significant
differences are observed in two cross-border regions (Muang Mukdahan district of
Thailand and Kaysone Phomvihane district of Lao PDR, and Maesod district of Thailand
and Myawaddy district of Myanmar) as its p-value indicated significance at 99%
confidence level. In contrast, there is no significant difference in the cross-border region of
Aranyaprathet district of Thailand and OChrov district of Cambodia as indicated by its pvalue.
7) Employment of immigrant labor
Only respondents across Thai border districts employ immigrant labor. An average number
of immigrant labor engaged across Thai border districts is 3 to 5 workers. No immigrant
child labor is hired across Thai border districts. Table 8.19 below presents employment of
immigrant labor across Thai border regions.
Table 8.19 Employment of immigrant labor
Number of
Cross-Border Region
immigrant
Cross-Border Region 1 Cross-Border Region 2
labor
Tha
Cam
Tha
Lao
F
%
F
%
F
%
F %
None
38
79
0
0
55
96.5
0
0
<5 workers
8
16.6
0
0
2
3.5
0
0
5-15 workers
2
4.1
0
0
0
0
0
Total
48
100
0
0
57
100
0
0
Average
5
0
3
0
Standard
3
0
0
0
deviation
Fisher Exact
0.000
Test p-value
Cross-Border Region 3
Tha
Mya
F
%
F
%
21
70
0
0
8
26.7
0
0
1
3.3
0
0
30 100
0
0
4
0
2
0
applied to the above table to understand the similarities and differences of the employment
of immigrant labor across Thai border regions. It is obvious that significant differences are
observed across Thai border regions as its p-value revealed significance at 99% confidence
level.
8) Daily wage rates of local and immigrant labor
In 2011, the official minimum daily wage rate for Thai citizens in Thai border provinces of
Sakaeo, Mukdahan and Tak are set at 173 Baht, 165 Baht and 162 Baht, respectively. In
fact, the respondents across Thai border districts offer daily wage rates to immigrant labor
slightly lower than the official minimum daily wage rate averaging at 118 Baht, 131 Baht
and 138 Baht in Aranyaprathet, Muang Mukdahan and Maesod districts, respectively. On
the other hand, respondents in both bordering districts of OChrov in Cambodia and
Kaysone Phomvihane in Lao PDR compensate with local daily wage rate even lower at 66
Baht. Table 8.20 below presents daily wage rates of local and immigrant labor across three
cross-border regions.
Table 8.20 Daily wage rates of local and immigrant labor
Daily wage rate
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
55
96.40
23
76.6
0
0
0
0
0
0
7
23
0
3.5
0
0
2
0
0
0
0
0
0
0
57
100
30
100
131
66
0
0
Cross-Border Region 1
Cross-Border Region 3
Tha
Cam
Tha
Mya
F
%
F
%
F
%
F
%
None employment
38
79.1
29
93.5
21
70
0
0
50 Baht
0
0
0
0
0
0
0
0
50-80 Baht
0
0
2
6.5
1
3.3
0
0
80-110 Baht
5
10.4
0
0
5
16.5
0
0
110-150 Baht
4
8.3
0
0
4
13.2
0
0
>150 Baht
1
2
0
0
1
3.3
0
0
Total
48
100
31
100
30
100
0
0
Mean
118
66
138
0
Standard deviation
25
0
50
0
Source: Field survey during 2009-2012.
Note: During the year 2009-2012, the annual average exchange rate was 31.90 Thai Baht
equivalent to 1 US$.
Thus, daily wage rates for immigrant labor across Thai border districts are considerably
higher (2 to 2.50 times) than the above 2 bordering districts. For comparative analysis, a
tenth of respondents in Aranyaprathet district of Thailand compensate immigrant labor
with 80 Baht to 110 Baht per day. Almost a tenth of respondents pay 110 Baht to 150 Baht
per day and one respondent remunerates higher than 150 Baht per day. A few of
respondents in OChrov district of Cambodia pay local daily wages of 50 Baht to 80 Baht.
On the contrary, few of respondents in Muang Mukdahan district of Thailand compensate
immigrant Laotian labor with 110 Baht to 150 Baht per day, while less than a fifth of
respondents in Kaysone Phomvihane district of Lao PDR remunerates with 50 Baht to 80
Baht daily. Few of respondents compensate with 80 Baht to 110 baht per day. In
comparison, more than a tenth of respondents in Maesod district of Thailand pay daily
wages of either 80 Baht to 110 Baht or 110 Baht to 150 Baht to immigrant Burmese labor.
Very few respondents compensate with daily wages of 50 Baht to 80 Baht or more than
150 Baht.
122
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
55 96. 30 100
4
2
0
0
3.5
Cross-Border Region 1
Tha
Cam
F
%
F
%
38
79.2
31 100
1. None employment
of immigrant labor
2. Local Thai labor
3
6.3
0
force is choosy with
jobs.
3. Immigrant labor in
7
14.6
0
their city is cheap, so
they can reduce
managerial cost
4. Competent
0
0
0
communication of
neighboring countrys
language
Total
48
100
31
Source: Field survey during 2009-2012.
Cross-Border Region 3
Tha
Mya
F
%
F
%
21
70
30 100
2
6.7
17
6.7
30
30
100
30
57
100
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
38
79.2
31 100
1. None
employment
2. Daily
10
20.8
0
3. Seasonal
0
0
0
4. Circular
0
0
0
5. Long-term
0
0
0
immigration with
all family
members
Total
48
100
31
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
55
96.4
30
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
21
70
30 100
0
0
0
0
0
0
2
0
0
0
3.5
0
0
0
0
0
0
0
0
0
5
1
1
2
17
3.3
3.3
6.6
0
0
0
0
0
0
0
0
100
57
100
30
100
30
100
30
100
123
Cross-border movement patterns of immigrant labor vary very much across Thai border
districts. A fifth of respondents in Aranyaprathet district and less than a fifth of
respondents in Maesod district answered daily cross-border movement of immigrant labor.
Only a very small proportion of respondents in both Muang Mukdahan and Maesod
districts revealed circular immigration. Few of respondents in Maesod district answered
long-term immigration of Burmese workers with all family members. A few of
respondents indicated seasonal immigration.
8.3 Local Cross-Border Shopping
Cross-border shopping is currently on the rising trend due to adjacency of structural
differences between Thailand and bordering countries (e.g., price differences, variety of
available products, and high quality standards of Thai products). It is also associated with
cross-border tourism. The pattern of cross-border shopping across the cross-border regions
is as follows:
1) Gender of cross-border shoppers
Table 8.23 below presents the gender of cross-border shoppers
Table 8.23 Gender of cross-border shoppers
Gender
Male
Female
Cross-Border Region 1
Tha
Cam
F
%
F
%
18
60
14
46.6
12
40
16
53.3
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
66
62.2
49
46.2
40
37.7
57
53.7
Cross-Border Region 3
Tha
Mya
F
%
F
%
16
53.3
13
43.3
14
46.6
17
56.6
Total
30
106
30
100 30
0.000
100
100
106
0.000
100
100
30
0.000
p-Value
Source: Field survey during 2009-2012.
Significance Levels: p 0.10; p 0.05; p 0.01
Remarks: Thailand (Tha)-Cambodia (Cam): Aranyaprathet District/ OChrov District; Thailand
(Tha)-Lao PDR (Lao): Muang Mukdahan District/ Kaysone Phomvihane district; Thailand
(Tha)-Myanmar (Mya): Maesod District/ Myawaddy District
F means frequency.
The gender of cross-border shoppers significantly varies across the cross-border regions.
Ranging from 53.30% to 62.20% of respondents across Thai border districts are male
shoppers, while 53.30% to 56.60% of respondents across the bordering districts are female
shoppers. For comparative analysis, 3 fifth of respondents in Aranyaprathet district of
Thailand are men and 2 fifth of respondents are women. Quite the reverse, more than half
of respondents in OChrov district of Cambodia are women and less than half of the
respondents are men. Likewise, more than 3 fifth of respondents in Muang Mukdahan
district of Thailand are men and less than 2 fifth of respondents are women. On the
contrary, more than half of respondents in Kaysone Phomvihane district of Lao PDR are
women and less than half of respondents are men. Similarly, slightly more than half of
respondents in Maesod district of Thailand are men and less than half of respondents are
women. Quite the opposite, more than half of respondents in Myawaddy district of
Myanmar are women and less than half of respondents are men. Chi-Square test is applied
to the above table to understand the similarities and differences of the gender of crossborder shoppers across three cross-border regions. It is apparent that significant differences
124
are observed across the cross-border regions as its p-value indicated significance of 99%
confidence level.
2) Marital status of shoppers
The marital status of cross-border shoppers is almost uniform across the cross-border
regions, in which 56.60% to 96.60% of respondents are already married. For comparative
analysis, most of respondents in Aranyaprathet district of Thailand are already married.
There are very few respondents who are still single. Likewise, 93.30% of respondents in
OChrov district of Cambodia are currently married and few of respondents are still single.
Also, more than half of respondents in Muang Mukdahan district of Lao PDR are presently
married and more than a third of respondents are still single. A few of respondents are
divorced. Similarly, more than half of respondents in Muang Mukdahan district of
Thailand are currently married and a third of respondents are still single.
Table 8.24 below presents the marital status of cross-border shoppers across three crossborder regions.
Table 8.24 Marital status of cross-border shoppers
Marital
status
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
3.3
2
6.7
29
96.6
28
93.3
0
0
0
0
30
100
30
0
0.23
Single
Married
Divorced
Total
Fisher
Exact
Test
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
35
33
21
19.8
63
59.4
78
73.5
8
7.54
7
6.6
106 100
106
100
0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
7
23.3
13
43.3
23
76.6
17
56.6
0
0
0
0
30
100
30
100
0.000
40 to 47 years old. On the other hand, respondents across the bordering districts are much
younger with average age of 24 to 40 years old. For comparative analysis, shoppers in
Aranyaprathet district of Thailand and OChrov district of Cambodia are 30 to 40 years
Table 8.25 below shows the ages of cross-border shoppers across three cross-border
regions.
Table 8.25 Age of cross-border shoppers
Age
2 p-value
Cross-Border Region 1
Tha
Cam
F
%
F
%
10
33.3
4
13.2
20
66.6
12
40
0
0
14
46.2
30
100
30
100
40
30
12
10
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
29
27.4
3
2.8
60
56.6 100 94.3
17
16.0
3
2.8
106
100 106 100
47
40
34
20
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
7
23.1
22
73.3
22 73.3
8
26.7
1
3.3
30
100
30 100
40
24
11
10
0.000
0.000
0.000
(82.30%) in Myanmar are local border residents. Also, slightly 4 fifth of respondents in
Kaysone Phomvihane district of Lao PDR originate from bordering Savannakhet province.
For comparative analysis, most of cross-border Thai shoppers in OChrov district of
Cambodia are outsiders or regional tourists, while most of cross-border Cambodian
Table 8.62 below presents the original residence of cross-border shoppers in three crossborder regions.
Table 8.26 Original residence of cross-border shoppers
Origin
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
3.3
13
43.3
1. Study border
district
2. Study border
3
10
11
36.6
province
3. Neighbouring
14
46.6
2
6.6
provinces
4. Capital city
12
40
2
6.6
5. Other regions
0
0
0
0
Total
30
100
30
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
25
82.5
59
55.6
86
81.1
23.1
6.6
33
31.1
19
17.9
19
63.3
2
12
106
1.8
11.3
100
1
0
106
0.9
0
100
2
2
30
6.6
6.6
100
3
0
30
10
0
100
1. Border market
2. Border duty
free shops
3. Border city
0
0
3
10
market
4. Leading
0
0
12
40
modern border
retail stores
Total
30
100
30 100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
0
0
58
54.7
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
18
60
2
6.6
0
0
0
0
48
45.2
6.6
12
40
99
93.3
28
93.3
106
100
106
100
30
100
30
100
Similarly, more than half of cross-border Thai shopper respondents in Muang Mukdahan
district of Thailand purchase at Daoroung duty free shops in bordering Kaysone
Phomvihane district of Lao PDR. Less than half of Thai respondents shop at Singapore
city market in bordering Kaysone Phomvihane district of Lao PDR. In contrast, most of
respondents from Kaysone Phomvihane district of Lao PDR go shopping at leading
modern border retail stores in bordering Muang Mukdahan district of Thailand. A few of
Laotian respondents buy at Mukdahan city market of Thailand. Correspondingly, 3 fifth of
Thai shopper respondents in Maesod district do their shopping of a wide range of Burmese
products at Rim Moei border market located in Maesod district of Thailand.
Two fifth of Thai shoppers respondents go shopping at Myawaddy city market of
Myanmar. On the contrary, most of Burmese shopper respondents from Myawaddy district
of Myanmar go shopping at leading modern border retail stores in Maesod district of
128
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
34
32.1
0
0
9
8.5
0
0
14
13.2
0
0
8
7.5
8
7.5
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
3.3
0
0
1
3.3
0
0
0
0
0
0
1
3.3
4
13.2
0
3.3
56.7
13.3
3.3
3.3
0
0
17
0
0
0
0
17
0
16
0
0
0
0
16
1
0
53
8
19
0
0
1
0
50
7.5
17.9
0
0
1
0
0
0
1
0
0
3.3
0
0
0
3.3
0
0
0
0
18
0
0
1
0
0
0
59.4
0
0
3.3
0
0
0
0
4
2
0
3.8
1.9
0
0
0
8
0
0
7.5
0
0
0
0
0
0
0
0
6
0
0
19.8
0
0
1
0
1
0
0
0
0
0
0
21
0
70
1
0
3.3
0
0
100
0
106
0
100
0
106
0
100
3
30
10
100
0
30
0
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
17
56.6
0
0
8
26.6
0
0
2
6.6
1
3.3
0
0
1
3.3
129
Likewise, almost a third of Thai shopper respondents buy liquor and wine in bordering
Kaysone Phomvihane district of Lao PDR. Less than a fifth of Thai respondents purchase
either mobile phones or mushroom. More than a tenth of Thai shopper respondents buy
purses and less than a tenth of Thai respondents procure either cigar or ready to wear
clothes. A few of Thai shoppers purchase herbal medicines and one Thai respondent buys
food stuffs. On the contrary, half of Laotian shopper respondents buy consumer goods in
bordering Muang Mukdahan district of Thailand. Less than a fifth of Laotian respondents
purchase household goods. A few of Laotian respondents acquire either electric appliances,
food stuffs, or ready to wear garment in Muang Mukdahan district of Thailand. There are
very few Laotian respondents who obtain either shoes or chemical fertilizers. Quite the
reverse, more than 2 third of Thai shopper respondents in Maesod district buy fresh and
dry sea aquatic products in bordering Myawaddy district of Myanmar. A tenth of Thai
respondents purchase forest products. Only a very small proportion of Thai respondents
acquire liquor and wine, cigar, computer and parts and necessity (e.g., clothes and shoes).
While 3 fifth of Burmese shopper respondents shop consumer goods in bordering Maesod
district of Thailand, a fifth of Burmese respondents buy fruits and vegetables. More than a
tenth of Burmese respondents purchase ready to wear garments and a few of Burmese
respondents buy either food stuffs or household goods.
7) Spending amount per cross-border shopping
Table 8.29 below presents spending per cross-border shopping across three cross-border
regions.
Table 8.29 Spending per cross-border shopping
Spending
Amount
(Baht)
<2,500
2,500-3,500
>3,500
Total
Mean
Standard
deviation
Cross-Border Region 1
Tha
Cam
F
%
F
%
18
60.0
15
50.0
10
33.3
14
46.6
2
6.7
1
3.4
30
100
30
0
1,425
1,255
1,575
944
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
44
41.5
12
11.3
56
52.8
49
46.2
6
5.6
45
42.5
106
100
106
100
1,878
855
Fisher Exact
0.000
Test p-value
Source: Field survey during 2009-2012.
4,607
2,640
0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
15
50
24
80.0
15
50
4
13.3
0
0
2
6.7
30
100
30
100
625
331
1,500
1,912
0.000
Baht per shopping in Aranyaprathet district of Thailand, almost half of them pay more than
3,500 Baht per shopping. One Cambodian respondent spends more than 3,500 Baht per
shopping.
On the contrary, the average spending amount per shopping of Laotian respondents in
bordering Muang Mukdahan district of Thailand is very high at 4,607 Baht. Whereas the
average spending amount per shopping of Thai respondents in bordering Kaysone
Phomvihane district of Lao PDR is significantly lower at 1,878 Baht, slightly more than
half of Thai respondents spend 2,500 Baht to 3,500 Baht per shopping in bordering
Kaysone Phomvihane district of Lao PDR. Slightly more than 2 fifth of Thai respondents
expend less than 2,500 Baht per shopping and a few of them use up more than 3.500 Baht
per shopping. In contrast, more than 2 fifth of Laotian respondents spend either less than
2,500 Baht or 2,500 Baht to 3,500 Baht per shopping in Muang Mukdahan district of
Thailand. Slightly more than a tenth of Laotian respondents spend less than 2,500 Baht per
shopping.
Quite the opposite, the average spending amount of Thai respondents in bordering
Myawaddy district of Myanmar is rather low at 625 Baht per shopping. While the average
spending amount of Burmese respondents in bordering Maesod district of Thailand is
much higher at 1,500 Baht per shopping, half of Thai respondents purchase goods in
Myawaddy district of Myanmar either less than 2,500 Baht or 2,500 Baht to 3,500 Baht per
shopping. In contrast, 4 fifth of Burmese respondents buy goods in Maesod district of
Thailand at less than 2,500 Baht per shopping and more than a tenth of them purchase at
2,500 Baht to 3,500 Baht per shopping. A few of Burmese respondents spend more than
3,500 Baht per shopping. A broad range of standard deviations shown in the table is
iimplying that some respondents may have underreported their shopping expenses. Fisher
Exact test is applied to the above table to understand the similarities and differences of the
spending across the cross-border regions. It is evident that significant differences are
observed across three cross-border regions as its p-values indicated significance of 99%
confidence level.
8) Frequency of cross-border shopping
Table 8.30 below presents the frequency of cross-border shopping across three crossborder regions.
Table 8.30 Frequency of cross-border shopping
Frequency
Cross-Border Region 1
Tha
Cam
F
%
F
%
Daily
0
0
4
13.3
Weekly
3
10
14
46.6
Monthly
20 66.6
8
26.6
Every 3 months
6 19.8
2
6.6
Every 6 months
1
3.3
2
6.6
Rarely
0
0
0
0
Total
30 100
30
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
16
15
3
2.83
11
10.3
81
76.4
20
18.8
20
18.8
58
54.7
1
0.9
0
0
0
0
1
0.9
1
0.9
106 100 106 100
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
3.3
20
66.6
1
3.3
5
16.6
14
46.6
3
10
1
3.3
1
3.3
3
10
1
3.3
10
33
0
0
30
100
30
100
shopping than those respondents across Thai border districts. Respondents in OChrov
district (46.60%) of Cambodia and Kaysone Phomvihane district (76.40%) of Lao PDR do
cross-border shopping on weekly basis. Interestingly, 2 third of respondents in Myawaddy
district of Myanmar do cross-border shopping on daily basis. On the other hand, 18.80% to
46.60% of respondents across Thai border districts go shopping on monthly basis.
For comparative analysis, 2 third of Thai respondents go for cross-border shopping in
OChrov district of Cambodia on a monthly basis. A fifth of Thai respondents do crossborder shopping every 3 months and a tenth of them go shopping on weekly basis. One
respondent goes for cross-border shopping every 6 months. Likewise, more than a quarter
of Cambodian respondents go shopping in bordering Arayaprathet district of Thailand on a
monthly basis and more than a tenth of them go shopping on daily basis. A few of
Cambodian respondents go shopping either every 3 months or every 6 months.
Also, more than half of Thai respondents in Muang Mukdahan district expressed doing
cross-border shopping in bordering Kaysone Phomvihane district of Lao PDR every
3 months. Almost a fifth of both Thai and Laotian respondents stated that they perform
cross-border shopping on monthly basis. Less than a fifth of Thai respondents informed of
doing cross-border shopping in Kaysone Phomvihane district of Lao PDR on daily basis.
And a tenth of Thai respondents answered that they go for cross-border shopping 2 to 3
times per week. On the contrary, more than half of Laotian respondents do cross-border
shopping on weekly basis and almost a quarter of them go shopping 3 times per week. A
few of them leave for cross-border shopping on daily basis. Only a very small proportion
go shopping either every 3 months or rarely.
Correspondingly, Burmese shoppers do more frequent cross-border shopping than those
Thai shoppers. There are very few Thai and Burmese respondents doing cross-border
shopping every 3 months. Almost half of Thai shoppers do cross-border shopping in
Myawaddy district of Myanmar on a monthly basis. A third of Thai respondents do yearly
shopping and a tenth of them go shopping every 6 months. Only a very small proportion of
Thai respondents do shopping either daily or weekly basis. Quite the reverse, 2 third of
Burmese respondents do daily cross-border shopping in bordering Maesod district of
Thailand. Almost a fifth of Burmese respondents perform weekly cross-border shopping. A
tenth of them do cross-border shopping on monthly basis. There are very few respondents
who go shopping in bordering Maesod district of Thailand every 6 months.
9) Purpose of cross-border shopping
The purposes of cross-border shopping are almost similar across the cross-border regions
with 40% to 90% of respondents reported of buying goods for their own consumption. For
comparative analysis, almost half of Thai respondents and 2 fifth of Cambodian
respondents procure for their own consumption. Two fifth of Thai respondents and a third
of Cambodian respondents shop for re-sale. A quarter of Thai respondents and more than a
tenth of Cambodian respondents buy for their own consumption and for re-sale.
Also, almost 3 quarters of Thai respondents in Muang Mukdahan district buy for their own
consumption and a fifth of them purchase for re-sale. A few of them acquire, both for their
own consumption and re-sale. Likewise, less than half of respondents in Kaysone
Phomvihane district of Lao PDR buy for their own consumption and 2 fifth of them
purchase for re-sale. More than a tenth of Laotian respondents acquire, both for their own
consumption and re-sale. Correspondingly, most of Thai shoppers and more than 2 third of
Burmese cross-border shoppers buy for their own consumption. A tenth of Thai
132
Table 8.31 below shows the purpose of cross-border shopping across three cross-border
regions.
Table 8.31 Purpose of cross-border shopping
Purpose
Own consumption
Resale
Both own
consumption and
resale
Total
Cross-Border Region 1
Tha
Cam
F
%
F
%
14
46.6
12
40
12
40
10
33
4
13.3
8
26.6
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
77
72.6
48
45.3
23
21.7
43
40.6
6
5.6
15
14.2
Cross-Border Region 3
Tha
Mya
F
%
F
%
27
90
22
73.3
0
0
2
6.7
3
10
6
20
30
106
30
100
30
0.472
100
100 106
0.000
p-value
Source: Field survey during 2009-2012.
100
100 30
0.03
100
1. Passenger car
2. International
scheduled bus/van
3. River boat
0
0
0
0
4. Tourist bus
10
33.3
0
0
5. Car rental
0
0
0
0
6. Local transport
0
0
0
0
7. Bicycle
0
0
0
0
8. On foot
0
0
24
80
Total
30
100
30
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
34
32.1
43
40.6
39
36.8
42
39.6
Cross-Border Region 3
Tha
Mya
F
%
F
%
19
63
2
6.7
0
0
21
70
33
0
0
0
0
0
106
0
10
1
0
0
0
30
31.1
0
0
0
0
0
100
133
21
0
0
0
0
0
106
19.8
0
0
0
0
0
100
0
33
4
0
0
0
100
0
0
1
5
1
0
30
0
0
3.3
16.7
3.3
0
100
The modes of cross-border transport noticeably vary across the cross-border regions
depending on geographical and extent of improvement of infrastructure linkages. Ranging
from 32.10% to 66.60% of respondents across Thai border districts use passenger cars.
Respondents in Kaysone Phomvihane district (39.60%) of Lao PDR and Myawaddy
district (70%) of Myanmar rely on international scheduled buses or vans. For comparative
analysis, 2 third of respondents in Aranyaprathet district of Thailand and a fifth of
respondents in OChrov district of Cambodia travel by passenger cars. A third of
respondents in Aranyaprathet district of Thailand use tourist bus, whereas almost a quarter
of respondents in OChrov district of Cambodia cross the border on foot due to close
geographical proximity.
In contrast, more than a third of respondents in both Muang Mukdahan district of Thailand
and Kaysone Phomvihane district of Lao PDR travel by international scheduled
buses/vans. Almost a third of respondents in Muang Mukdahan district journey by either
passenger cars or International Mekong river boats. Also, 2 fifth of respondents in Kaysone
Phomvihane district utilize passenger cars and almost a fifth of them travel by International
Mekong river boats. Correspondingly, 2 third of respondents in Maesod district of
Thailand travel by passenger cars and a third of them travel by tourist buses. A respondent
makes a journey by rental car. Whereas, more than 2 third of respondents in Myawaddy
district of Myanmar rely on international scheduled vans, less than a fifth of them utilize
local transport services available in Maesod district side. Few of respondents use passenger
cars and very few of them take a cross-border trip either by car rentals or bicycles.
8.4 Key Findings and Reflections
The above findings are summarized in the following sections.
8.4.1 Local Border Wholesaling
Most of the border wholesaler respondents across the cross-border regions are family based
businesses under the category of SMEs. The average duration of business operation is 14
years. Respondents across the cross-border regions sell a wide range of essential
commodities. There are 3 types of cross-border supply chains in the cross-border regions.
Respondents across the Thai border districts acquire goods mainly from manufacturers in
Bangkok metropolis and its vicinity, while respondents in the bordering districts obtain
goods mainly from cross-border wholesalers in Thailand. The number of labor employed
in a business across the cross-border regions varies from 4 to 14 workers. The number of
immigrant labor employed in a business across the Thai border districts ranges from 6 to 8
workers. The average daily wage rates across the Thai border districts are 2 to 3 times
higher than the counterpart bordering districts.
8.4.2 Local Border Retailing
The border retailer respondents across 5 border districts are mainly informal retailers,
except in Kaysone Phomvihane district of Lao PDR, where 91% registered as taxpayer.
Respondents in 2 Thai border districts of Aranyaprathet and Maesod have longer duration
of business operation of more than 12 years, while respondents in bordering districts of
OChrov district of Cambodia and Myawaddy district of Myanmar have establishments
operating within the last 6 to 7 years. Moreover, respondents in Kaysone Phomvihane
district of Lao PDR have longer duration of operation (12 years). In contrast, respondents
in Muang Mukdahan district of Thailand have lower duration of operation (8 years). The
respondents sell almost similar kinds of goods. Respondents across the cross-border
134
regions procure goods mainly from cross-border wholesalers, which signify the existence
of cross-border supply chain linkages. Goods that originate from Thailand possess 30.30%
to 69.20% market share across the cross-border regions. The number of immigrant labor
employed in an establishment across Thai border districts vary from 3 to 5 workers. The
daily wage rates for immigrant labor across the Thai border districts are 2 to 2.50 times
higher than the counterpart bordering districts.
8.4.3 Cross-Border Shopping
Cross-border shopping is currently on the rising trend due to adjacency of structural
differences between Thailand and bordering countries (e.g., price differences, variety of
available products and high quality standards of Thai products). It is also associated with
cross-border tourism. Ranging from 53.30% to 62.20% of respondents across Thai border
districts are male shoppers, while 53.30% to 56.60% of respondents across the bordering
districts are female shoppers. The average age of respondents across Thai border districts
ranges from 40 to 47 years old, whereas the average age of respondents across the
bordering districts are much younger, ranging from 24 to 40 years old. Ranging from
31.10% to 63.30% of respondents across Thai border districts originate from other
neighboring provinces, while 43.30% and 82.30% of respondents in the 2 bordering
districts of OChrov in Cambodia and Myawaddy in Myanmar, respectively, are local
border residents. Also, slightly 4 fifth of respondents in Kaysone Phomvihane district of
Lao PDR originate from bordering Savannakhet province.
Shopping places also largely vary across the cross-border regions. Thai cross-border
shopper respondents who come from Muang Mukdahan and Aranyaprathet districts shop at
border duty free shops in bordering Kaysone Phomvihane district (54.20%) of Lao PDR
and OChrov district (79.20%) of Cambodia. On the other hand, 3 fifth of Thai shopper
respondents in Maesod district do shopping of a wide range of Burmese products at Rim
Moei border market located in Maesod district of Thailand. Moreover, 40% to 93.30% of
cross-border shopper respondents across the bordering districts mainly buy at leading
modern border retail stores across Thai border districts (e.g., Tesco Lotus and Big C, etc.).
There are different patterns of shopping commodities across the cross-border regions. Thai
shopper respondents in Muang Mukdahan (32.10%) and Aranyaprathet (56.60%) districts
purchase luxury goods (e.g., liquor and wine made in western countries) in counterpart
bordering districts. Quite the reverse, more than 2 third of Thai shopper respondents in
Maesod district buy fresh and dry sea aquatic products in bordering Myawaddy district of
Myanmar. In contrast, 50% to 59.40% of cross-border shopper respondents across the
bordering districts procure consumer goods. Respondents across the bordering districts
spend higher average amount per shopping. Respondents across the bordering districts do
more frequent cross-border shopping than those respondents across Thai border districts.
Ranging from 40% to 90% of respondents across the cross-border regions do cross-border
shopping for their own consumption. The modes of cross-border transport noticeably vary
across the cross-border regions depending on geographical and extent of improvement of
infrastructure linkages.
The chapter has discussed about local border wholesaling and retailing activities, and
strategic trading commodities. It also dealt with local and cross-border linkages of
wholesaling and retailing, as well as highlighted the pattern of logistics and supply chain
linkages. It described the profiles and behaviors of local and regional cross-border
shoppers and listed strategic shopping commodities. It analyzed the intensity of local and
regional cross-border shopping and spending. It is recognizable that a large number of
135
local residents rely on wholesaling and retailing activities for livelihoods. As a result, local
border wholesaling and retailing endeavors substantially contribute to the thriving growth
of local economy. The traders who are mainly from SMEs also gain a great deal of benefits
from greater cross-border connectivity. There are existing local border and cross-border
linkages between wholesaling and retailing that similarly foster supply chain links. Due to
adjacency of structural differences, cross-border shopping is becoming another growth
engine of local border economy, particularly in the studied Thai border cities. Finally, the
preceding key findings and reflections support the hypothesis stating that cross-border
trade regions are expected to gain infrastructural, economic and service benefits at the
regional scale due to production and trading linkages.
136
CHAPTER 9
LOCAL AND REGIONAL CROSS-BORDER PRODUCTION LINKAGES
This chapter provides a micro level analysis of local and regional cross-border industrial
linkages. It also covers the characteristics and pattern of border industrial
entrepreneurships. The details of comparative cross-border analysis are outlined in the
sections that follow.
9.1 Local Border Industrial Development
The specific characteristics of local border industrial development and cross-border
production linkages are as follows:
1) Registrations of industries
Registrations of industries greatly vary across the cross-border regions. Respondents across
Thai border districts have higher types of formal registrations than counterpart respondents
in the bordering districts. Respondents across Thai border districts of Muang Mukdahan
(35%), Aranyaprathet (45%) and Maesod (50.70%) register as company limited, whereas,
respondents across the bordering Kaysone Phomvihane district (36.10%) of Lao PDR;
Myawaddy district (70%) of Myanmar and OChrov district (100%) of Cambodia operate
as cottage industries. The cottage industries are not required to formally register with
relevant government agencies, particularly in Myawaddy and OChrov districts. For
comparative analysis, slightly more than half of respondents in Aranyaprathet district of
Thailand register as cottage industries. A third of respondents in Muang Mukdahan district
of Thailand register as partnership limited and a quarter register as merchant shop. A few
of respondents register either as ordinary partnership or cottage industry. In comparison,
almost 2 third of respondents in Kaysone Phomvihane district of Lao PDR register as
company limited. Correspondingly, almost a third of respondents in Maesod district of
Thailand register as partnership limited and more than a tenth register as cottage industry.
A few of respondents register as ordinary partnership. Likewise, a third of respondents in
Myawaddy district of Myanmar register as company limited.
2) Investment incentives
The investment incentives significantly vary across the cross-border regions. Interestingly,
respondents across the bordering districts gain higher investment incentives from their
respective bordering governments than counterpart respondents across Thai border
districts. This might have resulted from the Royal Thai Governments policy directing that
border industries engaging a large number of immigrant labor are ineligible to gain any
government investment incentive. For comparative analysis, respondents across the
bordering OChrov district (0%) of Cambodia, Myawaddy district (20%) of Myanmar and
Kaysone Phomvihane district (23%) of Lao PDR receive higher special border economic
zone investment incentives. Interestingly, a Thai respondent in Kaysone Phomvihane
district of Lao PDR instead acquires Thailands outward investment incentives. On the
other hand, respondents across Thai border districts of Muang Mukdahan (0%), Maesod
(5.80%) and Aranyaprathet (10%) in Zone 3 receive lower investment incentives from
Thailand.
3) Reasons for locating border industries
Respondents across the studied bordering districts of OChrov (16.70%) in Cambodia,
Kaysone Phomvihane (67.2%) in Lao PDR and Myawaddy (83.40%) in Myanmar have
larger endogenous industries. Respondents across Thai border districts of Maesod (48%),
137
Table 9.1 below presents the reasons for locating border industries across three crossborder regions.
Table 9.1 Reasons for locating border industries
Reason
Cross-Border Region 1
Tha
Cam
F
%
F
%
12
60
5
16.7
1. Originally
endogenous industry
2. Close proximity to
3
15
25
83.3
market in bordering
city/country
3. Access to abundant
1
5
0
0
local labor
4. Access to abundant
0
0
0
0
raw materials in
bordering city
5. Access to abundant
0
0
0
0
labor in bordering city
6. Access to abundant
3
15
0
0
local materials
7. Local market
1
5
0
0
expansion
Total
20 100 30
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
27
62.7
41
67.
2
5
11.6
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
33
48
25
83.4
1
1.4
16.6
35
51
5
4
9.3
1
1.6
2.3
14
0
10
0
43
0
100
10
61
16
100
69
100
30
0
100
Aranyaprathet (60%) and Muang Mukdahan (62.70%) have slightly smaller endogenous
industries.As a result, respondents across Thai border districts of Muang Mukdahan
(37.30%), Aranyaprathet (40%) and Maesod (52%) have larger exogenous industries. On
the contrary, respondents in the 2 bordering districts of Myawaddy (17%) in Myanmar and
Kaysone Phomvihane (32.8%) in Lao PDR have smaller exogenous industries. OChrov
district (83.30%) of Cambodia hosts the largest exogenous industries.
For comparative analysis of exogenous industries, the reasons for locating border
industries substantially vary across the cross-border regions. Less than a tenth of
respondents in Aranyaprathet district of Thailand answered either close proximity to
bordering Cambodian market or access to abundant local materials. A few of
respondents replied either access to abundant local labor or local market expansion. On
the contrary, most of respondents in OChrov district of Cambodia replied that their reason
is the close proximity to bordering Aranyaprathet market of Thailand. Also, less than a
fifth of respondents in Muang Mukdahan district of Thailand mentioned access to
abundant local raw materials. A tenth of respondents informed either close proximity to
Lao PDR and neighboring country markets or access to abundant raw materials from Lao
PDR. A few of respondents stated that their reason is the access to abundant labor from
Lao PDR. Likewise, almost a fifth of respondents in Kaysone Phomvihane district of Lao
PDR replied that they would gain from local market expansion. Almost a tenth of
respondents replied access to abundant local materials or land. Few of respondents
expressed that they have access to abundant local labor. One respondent informed of
having access to abundant raw materials from adjacent Mukdahan province of Thailand.
Remarkably, half of respondents in Maesod district of Thailand mentioned accessibility to
abundant labor from bordering Myawaddy district of Myanmar. One respondent gains
138
advantage of close proximity to bordering Burmese market. Likewise, more than a tenth of
respondents in Myawaddy district of Myanmar are taking advantage of close proximity to
bordering Maesod market in Thailand.
Pertaining to relocation of exogenous industries into the cross-border regions, apparently,
almost half of respondents in Maesod district of Thailand originally moved from Bangkok
metropolis and its vicinity. A few of respondents shifted from Northern region of Thailand.
On the other hand, a Burmese respondent in Maesod district relocated from Yangon due to
internal political conflict in Myanmar. Likewise, a respondent in Kaysone Phomvihane
district of Lao PDR is transferred either from Vientiane or from northern region of Lao
PDR. Lastly, all of respondents across the other 4 border districts are truly start-up border
industries. These findings are consistent with the concept of geographical division of labor
as Harvey (2005) argues that the coercive laws of competition push capitalists to relocate
production to more advantageous sites. And the special requirements of particular forms of
commodity production push capitalist into territorial specialization.
4) Purpose of establishment
Table 9.2 below presents the purpose of establishing industries across three cross-border
regions.
Table 9.2 Purpose of establishment
Purpose
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
42
98
53
87
Cross-Border Region 3
Tha
Mya
F
%
F
%
56
81.1
27
90
11.4
12
17.3
1.4
83.3
3.3
1.6
100
43
100
61
100
69
100
30
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
19
95
5
16.6
1. Open new
factory or service
2. Open new
1
5
0
branch plant
3. Being
0
0
0
domestically
outsourced
4. Being cross0
0
25
border outsourced
5. Being cross0
0
0
border franchising
Total
20 100 30
Source: Field survey during 2009-2012.
The purpose of establishing industries varies across the cross-border regions. Most
(81.10% to 95%) of the respondents across Thai border districts open new factories or
services together with border headquarters. Ranging from 16.60% to 90% of.respondents
across the bordering districts open new factories or services together with border
headquarters. Moreover, there is strong presence of cross-border outsourcing of production
activities from adjacent Aranyaprathet district of Thailand to bordering OChrov district
and surrounding provinces of Cambodia. Also, there are few existing cross-border
franchising from Muang Mukdahan district of Thailand to bordering Phomvihane district
of Lao PDR. For comparative analysis, most of respondents in Aranyaprathet district of
Thailand start new factories along with border headquarters and one respondent built a
plant for a new branch. In contrast, most of respondents in OChrov district of Cambodia
139
are sub-contracted industries from bordering Aranyaprathet district of Thailand and less
than a fifth of respondents initiate new border cottage factories.
Likewise, most of respondents in both Muang Mukdahan district of Thailand and Kaysone
Phomvihane district of Lao PDR start new factories or services alongside its border
headquarters. A tenth of respondents in Kaysone Phomvihane district of Lao PDR and a
respondent in Muang Mukdahan district of Thailand initiate new branch plants. On the
other hand, a respondent in Kaysone Phomvihane district of Lao PDR is a cross-border
franchisee from Thailand. Also, more than 4 fifth of respondents in Maesod district of
Thailand launch new factories or services alongside border headquarters. Almost a fifth of
respondents usually initiate plants for new branches, with headquarters located in Bangkok
metropolis and its vicinity. One respondent is a domestically outsourced industry. Whereas
greater than 4 fifth of respondents in Myawaddy district of Myanmar start new industries
or services with border headquarters, a few of respondents operate new branch plants. One
respondent is a cross-border outsourced industry from bordering Maesod district of
Thailand.
5) Duration of operation of border industrial establishments
Table 9.3 below presents the duration of operation of border industrial establishments
across three cross-border regions.
Table 9.3 Duration of operation of border industrial establishments
Duration of
operation
(Year)
Cross-Border Region 1
Tha
Cam
F
%
F
%
2
10
23
76.6
11
55
5
16.6
6
30
0
0
1
5
2
6.6
20 100 30
100
9.2
2.5
4.1
5
5 years
5-10 years
10-15 years
>15 years
Total
Mean
Standard
deviation
Fisher Exact
0.000
Test, p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
3
6.9
8
13.1
5
12
23
37.7
32
74
14
23
3
6.9
16
26.3
43
100
61
100
11.8
10.7
3.8
5.7
Cross-Border Region 3
Tha
Mya
F
%
F
%
26
37.7
7
23.3
18
25
18
60
22
32
5
16.6
3
4.3
0
0
69
100
30
100
7
6.9
5.9
4.2
0.002
0.02
Cross-Border Region 1
Tha
Cam
F
%
F
%
2
10
29
96.7
8
40
0
0
10
50
1
3.3
20 100 30
100
42
0.5
77
0.9
0.000
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
5
11.6
25
40.9
26
60.4
11
18.0
12 27.9
24
39.3
43
100
61
100
41
42
126
115
Chi square 0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
6
8.7
16
53.3
42
61
2
6.6
21 30.4
12
40.0
69
100
30
100
41
7.5
113
18
Chi square 0.000
Although most of respondents across the study cross-border regions are family based
border industries, respondents across Thai border districts obviously have greater access to
formal financial services which are directly provided by commercial banks, than those
counterpart respondents in the bordering districts. Respondents across Thai border districts
of Muang Mukdahan (88.40%), Aranyaprathet (90%) and Maesod (91.30%) have access to
formal financial services. Apparently, a lower number of respondents across the bordering
districts of OChrov (3.30%) in Cambodia; Myawaddy (40.10%) in Myanmar and Kaysone
Phomvihane (57.30%) in Lao PDR have access to formal financial services. This implies
that respondents across Thai border districts gain greater financial support opportunities for
border investments than counterpart respondents in the bordering districts.
Sources of invested capital considerably vary across the cross-border regions.
Respondents across Thai border districts of Muang Mukdahan (65%), Maesod (66%) and
Aranyaprathet (75%) gain from a combination of family source and commercial bank loan,
whereas, respondents in the 2 bordering districts of Myawaddy (60%) in Myanmar and
OChrov (98%) in Cambodia utilize family source. On the contrary, more than half of
respondents in Kaysone Phomvihane district of Lao PDR use a combination of family
source and bank loan. For comparative analysis, 3 quarters of respondents in Aranyaprathet
district of Thailand utilize a combination of family source and commercial bank loan.
More than a tenth of respondents gain mostly from commercial bank loan and a tenth of
respondents acquire wholly from family source. Whereas, almost all of respondents in
OChrov district of Cambodia mostly get from family source, few of respondents acquire
from commercial bank loan. Similarly, almost 2 third of respondents in Muang Mukdahan
district of Thailand obtain from a combination of family source and commercial bank loan.
Almost a quarter of respondents acquire mainly from commercial bank loan and slightly
more than a tenth of respondents obtain wholly from family source. Likewise, more than
half of respondents in Kaysone Phomvihane district of Lao PDR secure from a
combination of family source and commercial bank loan, and slightly more than 2 fifth of
respondents gain wholly from family source. Similarly, 2 third of respondents in Maesod
district of Thailand gain from a combination of family source and commercial bank loan.
A quarter of respondents obtain mostly from commercial bank loan and almost a tenth of
respondents secure wholly from family source. Whereas, almost 3 fifth of respondents in
Myawaddy district of Myanmar take mostly from family source, the other 2 fifth of
respondents gain from a combination of family source and commercial bank loan.
8) Manufactured goods and services provided
The manufactured products or services provided significantly vary across the cross-border
regions based on local resource endowments along with national and international division
of labor. Generally, Thai border districts are more industrialized than the 2 bordering
districts, except in Kaysone Phomvihane district of Lao PDR. Remarkably, major
productions are concentrated on fashion industry in both Maesod district of Thailand
(specializing in high-end products) and OChrov district of Cambodia (specializing in
low-end products). For comparative analysis, almost a third of respondents in
Aranyaprathet district of Thailand produce food and beverages. A quarter of respondents
manufacture basic agro-industry products. Two fifth of respondents make handicraft
products and a tenth of respondents produce wearable apparels and garments. There are
very few respondents who produce either construction materials or wood products, and
others who are cross-border logistics providers. Remarkably, as high as 93.30% of
respondents in OChrov district of Cambodia produce low-end wearable apparels and
garments. Only a very small proportion of respondents make either embroidery of second143
hand clothes or bedding products.Table 9.5 below presents the manufactured goods and
services provided across three cross-border regions.
Table 9.5 Manufactured goods and services provided
Product or service
Cross-Border Region 1
Tha
Cam
F
%
F
%
2
10 28
93.3
1. Wearable
apparels/garments
2. Textile
0
0
0
0
3. Basic agro-industry
5
25
0
0
4. Food and beverage
6
30
0
0
5. Handicraft
4
20
0
0
6. Construction
1
5
0
0
materials
7. Wood
1
5
0
0
products/furniture
8. Embriodery of
0
0
1
3.3
second-hand clothes
9. Bedding products
0
0
1
3.3
10. Second-hand
0
0
0
0
engine and parts
11. Recycled products
0
0
0
0
12. Liquidified gas
0
0
0
0
13. Car and
0
0
0
0
motorcycles
14. Electric appliances
0
0
0
0
15. Kitchenwares
0
0
0
0
16. Leather goods
0
0
0
0
17. Jewelry
0
0
0
0
18. Distribution center
0
0
0
0
19. Local/cross-border
1
5
0
0
logistics provider
Total
20
100 30
100
Source: Field survey during 2009-1012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
4
9
2
3.3
Cross-Border Region 3
Tha
Mya
F
%
F
%
46
66.7
6
20
0
8
5
0
16
0
19
12
0
37
0
12
10
4
17
0
19.7
16.4
6.6
28
8
4
2
2
2
11.6
5.7
2.9
2.9
2.9
0
0
0
11
0
0
0
0
36.7
0
12
11.5
1.4
6.7
0
2
0
4.7
0
0
0
0
0
0
0
0
0
0
0
0
1
1
0
2
2
0
0
1
1
0
1.6
1.6
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
0
0
0
0
0
2
0
1
1
0
0
2
3
1.6
1.6
0
0
3.3
5
0
0
1
0
0
1
0
0
1.4
0
0
1.4
0
0
0
2
5
4
0
0
0
6.7
16.7
13.3
43
100
61
100
69
100
30
100
On the contrary, Kaysone Phomvihane district of Lao PDR is more industrialized than the
bordering Muang Mukdahan district of Thailand. A third of respondents in both districts
manufacture construction materials. Almost a fifth of respondents in both districts involve
in basic agro-industry. A tenth of respondents in both districts produce either food and
beverage or wood products and wood furniture. A few of respondents in Kaysone
Phomvihane district of Lao PDR engage in either handicraft products or being cross-border
logistics service providers. Few of respondents make either wearable apparels and
garments or being distribution centers. There are very few respondents manufacturing
either car or motorcycle, electric appliances, housewares/kitchenwares or liquidified gas. A
tenth of respondents in Muang Mukdahan district of Thailand produce wearable apparels
and garments and one respondent manages either used engines or parts, recycled factory,
liquefied gas plant or being distribution center.
Likewise, most of respondents in Maesod district of Thailand are mainly involved in
industrial productions, whereas, the counterpart respondents in bordering Myawaddy
district of Myanmar are engaged in a mix of both industrial productions and trade-related
144
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
9
20
25
41
Cross-Border Region 3
Tha
Mya
F
%
F
%
7
10
7
23.3
17
39
14.7
2.9
30
0
13.3
0
9
0
20
0
1
0
1.6
2
50
2.9
72.5
0
1
0
3.3
0
0
5
0
12
0
6
11
9.8
18
2
2
2.9
2.9
7
0
23.3
0
86.7
9.8
20
0
100
0
43
0
100
3
61
4.9
100
4
69
5.8
100
0
30
0
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
11
55
0
0
Sourcing of raw materials notably vary across the cross-border regions. Cross-border
production linkages are noticeably existent in OChrov district of Cambodia as 86.70 % of
respondents acquire raw materials from bordering Aranyaprathet district in Thailand.
Whereas, almost 3 quarters of respondents in Maesod district of Thailand mainly procure
from domestic sources, particularly from Bangkok metropolis and its vicinity; the other 4
border districts (10% to 55%) utilize local contents, which mainly originated within their
respective border cities ranging. For comparative analysis, slightly more than half of
respondents in Aranyaprathet district of Thailand mainly acquire local contents. Less than
a fifth of respondents procure from either within Sakaeo province or from other regions. A
tenth of respondents purchase from Bangkok metropolis and its vicinity. A few of
respondents obtain from across Cambodia. Whereas, most of respondents in OChrov
district of Cambodia acquire from bordering Aranyaprathet district of Thailand, a few of
respondents procure from Phnom Penh, capital city of Cambodia.
145
Table 9.7 below presents cross-border exported raw materials, components and industrial
commodities across three cross-border regions.
Table 9.7 Cross-border exported raw materials, components and industrial
commodities
Commodity
Cross-Border Region 1
Tha
Cam
F
%
F
%
15
75
0
0
1
5
0
0
1. None
2. Agricultural
produces
3. Ready to wear
1
5
29
96.7
garment
4. Construction
1
5
0
0
materials
5. Cooking palm oil
2
10
0
0
6. Bedding
0
0
1
3.3
7. Rice grain
0
0
0
0
8. Food
0
0
0
0
9. Second-hand
0
0
0
0
engines and parts
10. Fishes
0
0
0
0
11. Processed woods
0
0
0
0
12. Jewelry and gem
0
0
0
0
13. Handicraft
0
0
0
0
products
Total
20
100
15
100
Source: Field survey during 2009-1012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
29
67
57
93
2
4.7
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
65
94.2
16
53.3
0
0
0
0
4.7
2.9
10
2.9
0
0
2
2
2
0
0
4.7
4.7
4.7
0
0
0
1
0
0
0
0
1.6
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
0
0
0
2.3
0
0
0
0
3
0
0
0
5
0
0
0
0
0
0
0
0
0
0
0
1
8
2
0
3.3
26.7
6.7
43
100
61
100
69
100
30
100
Quite the opposite, respondents in Myawaddy district of Myanmar perform greater crossborder export of either intermediate or finished commodities as a fifth of respondents
export jewelry and gem stones. A tenth of respondents distribute ready to wear garments, a
few export handicraft products, and a few sell wood products. In contrast, a few of
respondents in Maesod district of Thailand trade either ready to wear garments or
construction materials.
10) Cross-border imported raw materials, components and industrial commodities
Cross-border imported raw materials, components and industrial commodities vary much
across the cross-border regions. Most of respondents across the bordering districts of
Myawaddy (76.40%) in Myanmar, Kaysone Phomvihane (83.40%) in Lao PDR and
OChrov (86.70%) in Cambodia do cross-border import of components, intermediate and
industrial goods. On the other hand, respondents across Thai border districts of
Aranyaprathet (0%), Maesod (11.60%) and Muang Mukdahan (23%) import either raw
materials or industrial. For comparative analysis, most of respondents in OChrov district
of Cambodia import textile fabric and accessories from bordering Aranyaprathet city of
Thailand. Likewise, almost a fifth of respondents in Muang Mukdahan district of Thailand
import processed woods. Very few of respondents bring in either raw materials or
components (e.g., sand and stone or agricultural commodities). Whereas, almost half of
respondents in Kaysone Phomvihane district of Lao PDR perform import of capital goods
(e.g., machinery, mechanical equipments and mold and die), almost a quarter of
respondents trade in intermediate goods and parts, and few import either steel, young
147
1. None
2. Textile fabric and
accessories
3. Processed woods
0
0
0
0
4. Sand and stone
0
0
0
0
5. Agricultural
0
0
0
0
produces
6. Machinery/mold
0
0
0
0
and die/intermediate
goods and parts
7. Steel
0
0
0
0
8. Young plant
0
0
0
0
9. Construction
0
0
0
0
materials
10. Dust saw
0
0
0
0
Total
20
100
30
100
Source: Field survey during 2009-1012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
33
77
10
16.4
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
61
88.4
7
23.3
0
0
7
23.3
8
1
1
19
2.3
2.3
0
0
0
0
0
0
2
0
4
2.8
0
5.7
0
0
0
0
0
0
14
23
16.6
0
0
0
0
0
0
4
3
2
6.6
5
3.3
1
0
0
1.4
0
0
5
0
6
16.6
0
20
0
43
0
100
0
30
0
100
1
69
1.4
100
0
30
0
100
148
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
42
71
58
84
3
5
4
6
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
5.8
10
33.3
2
2.9
12
40
14
24
4.3
63
91.3
0
100
0
43
0
100
2
61
3
100
0
69
0
100
8
30
26.6
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
12
60
5
15.2
0
0
28
84.8
1. Local labor
2. Regional migrant
labor
3. Immigrant labor
8
40
0
from bordering city
4. Immigrant labor
0
0
0
from other countries
5. Self-employed
0
0
0
Total
20 100 33
Source: Field survey during 2009-1012.
Likewise, a few of respondents in both Muang Mukdahan district of Thailand and Kaysone
Phomvihane district of Lao PDR engage regional migrant labor force. More than 4 fifth of
respondents in Kaysone Phomvihane district of Lao PDR hire local labor force. A few of
respondents employ technically skilled labor from both Thailand and South Korea. Few of
respondents are totally self-employed. Whereas, almost 3 quarter of respondents in Muang
Mukdahan district of Thailand employ local labor force, almost a quarter of respondents
hire semi-skilled immigrant labor from bordering Savannakhet province of Lao PDR.
Apparently, there is an existing international division of labor in Maesod district of
Thailand, whereas, such practice is non-existent at all in the counterpart bordering
Myawaddy district of Myanmar. Remarkably, as high as 91% of respondents in Maesod
district of Thailand employ semi-skilled immigrant Burmese labor force, which are mainly
engaged in processes of producing finished goods (e.g., cutting, stitching, labeling, as well
as packing). A few of respondents hire either local or regional migrant skilled Thai labor
force, which are mainly responsible for both managerial and operational tasks (e.g., factory
managers, head of production sections, head of quality control sections, head of technical
sections and accountants, etc.). In contrast, 2 fifth of respondents in Myawaddy district of
Myanmar employ regional migrant labor, a third engage local labor, and a quarter of
respondents are totally self-employed.
12) Border industrial employment
Employments of workers notably vary across the cross-border regions. All of respondents
across Thai border districts employ higher number of labor, whereas, 73.40% to 96.70% of
respondents across the bordering districts engage lower number of employees. Therefore,
respondents across Thai border districts employ higher average number of workers at 34
workers, 61 workers and 142 workers in Muang Mukdahan, Aranyaprathet and Maesod
districts, respectively. On the other hand, respondents across the bordering districts engage
lower average number of workers at 27 workers, 37 workers and 42 workers in Myawaddy
district of Myanmar, Kaysone Phomvihane district of Lao PDR and OChrov district of
Cambodia, respectively. For comparative analysis, the average number of worker in
Aranyaprathet district of Thailand is 1.45 times higher than counterpart bordering OChrov
district of Cambodia. Table 9.10 below presents border industrial employment across three
cross-border regions.
149
Self-employed
10-50 workers
>50 workers
Total
Mean
Standard deviation
Fisher Exact Test,
p-value
Source: Field survey during 2009-1012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
2
3.3
28
65
20
32.8
15
35
39
63.9
43 100 61
100
34
37
112
63
0.002
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
8
26.6
3
4.3
10
33.3
66
95.7
12
40.0
69
100
30
100
142
27
193
56
0.000
150
None
10-50 workers
>50workers
Total
Average
Standard deviation
Chi-Square p-value
Source: Field survey during 2009-1012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
29
67
56
92
12
28
5
8
2
5
0
0
43 100 61 100
3
0.4
6.5
1.3
0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
1.4
0
0
5
7.2
0
0
63
27.5 0
0
69
100
0
0
140
0
194
0
1. None employment of
immigrant labor
2. Local Thai labor force
3
15
0
is choosy for jobs.
3. Shortage of Thai labor
3
15
0
force in their city.
4. Immigrant labor in
2
10
0
their city is cheap, so they
can reduce cost of
production
5. Required skilled labor
0
0
0
Total
20 100
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
29
67
56
92
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
1.4
0
0
20
29
20
20
29
28
40.5
0
0
0
43
0
100
5
61
8
100
0
69
0
100
0
0
0
0
Almost a tenth of respondents answered that immigrant labor in Muang Mukdahan district
of Thailand is cheap, so they can reduce production cost. Few of respondents told that local
Thai labor force refrain to work. In contrast, less than a tenth of respondents in Kaysone
Phomvihane district of Lao PDR replied that they need technically skilled labor from both
Thailand and South Korea. Correspondingly, 2 fifth of respondents in Maesod district of
Thailand reasoned that immigrant labor in their district is cheap, so they can reduce
production cost. Almost 2 third of respondents said that local Thai labor force refrain to
work with 4Djobs (dirty, dangerous, difficult and degrading jobs) and because of shortage
of local Thai labor force in Maesod district. Therefore, migratory inflows of unskilled
Burmese workers vastly replace local Thai labor in Maesod district of Thailand.
Regarding cross-border movement patterns of immigrant labor, significant variation is seen
across the cross-border regions, mainly depending on economic forces and extent of
relaxation of rules and regulations on cross-border movement. For comparative analysis,
less than a fifth of respondents in Aranyaprathet district of Thailand informed either
seasonal or circular cross-border movements. A tenth of respondent indicated daily crossborder movement. Similarly, less than a fifth of respondents in Muang Mukdahan district
of Thailand informed of long-term immigration with all family members. A tenth of
respondents told of seasonal immigration and a few of respondents expressed circular
immigration. Moreover, almost a tenth of respondents in Kaysone Phomvihane district of
Lao PDR replied that it is dependent on contractual basis. Correspondingly, 2 fifth of
respondents in Maesod district of Thailand stated either circular movement or long-term
immigration with all family members. A tenth of respondents indicated daily cross-border
movement.
15) Gender ratios of immigrant labor
There is an existing international division of immigrant labor by gender across Thai border
districts. For instance, female immigrant labor are mainly employed in fashion industry,
whereas, male immigrant labor are engaged in somewhat wider range of industries or
services. For comparative analysis, less than a fifth of respondents in Aranyaprathet district
of Thailand employ immigrant men and women with the ratio of 25 %:75 %.
152
Table 9.13 below presents the gender ratios of immigrant labor across three cross-border
regions.
Table 9.13 Gender ratios of immigrant labor
Ratio of men and
Cross-Border Region
women
Cross-Border Region
Cross-Border Region 2
Cross-Border Region 3
1
Tha
Cam
F
%
F
%
None employment
12
60
0
0
50:50
2
10
0
0
25:75
1
5
0
0
75:25
3
15
0
0
100 % male labor
2
10
0
0
100 % female labor
0
0
0
0
Total
20
100
0
0
Source: Field survey during 2009-2012.
Tha
F
29
1
4
5
4
0
43
Lao
%
67
2.3
9.3
12
9.3
0
100
F
56
0
0
2
3
0
61
Tha
%
92
0
0
3.3
5
0
100
F
1
9
25
12
5
17
69
%
1.4
13
36.3
17.4
7.2
24.6
100
F
0
0
0
0
0
0
0
Mya
%
0
0
0
0
0
0
0
A tenth of respondents hire men and women with the ratio of either 50%:50% or
100% men. Also, more than a tenth of respondents in Muang Mukdahan district of
Thailand employ 100% men. Almost a tenth of respondents engage male and female
immigrant labor at a ratio of 25%:75%. Only a very small proportion of respondents hire
either 100% women or equal ratio of men and women at 50%:50%. On the other hand, few
of respondents in Kaysone Phomvihane district of Lao PDR hire either 100% men or men
and women at a ratio of 75%:25%. Interestingly, almost a quarter of respondents in
Maesod district of Thailand hire totally 100% immigrant women particularly in fashion
industry. Slightly more than a third of respondents hire immigrant men and women at a
ratio of 25%:75%. Almost a fifth of respondents engage immigrant men and women at a
ratio of 75%:25%. More than a tenth of respondents employ equal gender distribution of
men and women migrants with the ratio of 50%:50%. A few of respondents employ 100%
immigrant male labor.
16) Daily wage rate for local and immigrant labor
In 2011, the official minimum daily wage rates for Thai citizen in the study Thai border
provinces of Tak, Mukdahan and Sakaeo are set at 162 Baht, 165 Baht and 173 Baht,
respectively. On the other hand, the immigrant labor received slightly lower than the
official minimum daily wage rates at an average of 108 Baht, 132 Baht and 148 Baht in
Aranyaprathet, Maesod and Muang Mukdahan districts, respectively. Moreover,
respondents across the bordering districts disburse even much lower average local daily
wages at 58 Baht, 68 Baht and 76 Baht in Myawaddy district of Myanmar, OChrov
district of Cambodia and Kaysone Phomvihane district of Lao PDR, respectively.
Therefore, respondents across Thai border districts pay higher (1.60 times to 3 times)
wages to immigrant labor than counterpart respondents in the bordering districts. For
comparative analysis, respondents in Aranyaprathet district of Thailand pay higher (1.60
times) average daily wage rate to immigrant labor than respondents in bordering OChrov
district of Cambodia for. A quarter of respondents compensate with 80 to 110 Baht per
day. Less than a fifth of respondents remunerated with 110 to 150 Baht per day. Whereas,
2 third of respondents in OChrov district of Cambodia remunerate less than 50 Baht per
day, slightly more than a quarter of respondents pay 50 to 80 Baht per day.
153
Table 9.14 below presents daily wage rates for local and immigrant labor across three
cross-border regions.
Table 9.14 Daily wage rate for local and immigrant labor
Daily wage rate
Cross-Border Region
Cross-Border Region 1
Cross-Border Region 2
Tha
F
%
12
60
0
0
0
0
5
25
3
15
0
0
0
0
20
100
109
17
Cam
F
%
2
6.7
20
66.6
8
26.6
0
0
0
0
0
0
0
0
30
0
68
234
Tha
F
%
29
67
0
0
0
0
2
5
4
9
8
19
0
0
43 100
148
28
Lao
F
2
0
35
19
0
0
5
61
76
14
Cross-Border Region 3
Tha
Mya
F
%
F
%
1
1.4
8
26.6
1
1.4
4
13.3
7
10.1
18
60
12
17.4
0
0
21
30.4
0
0
27
39.1
0
0
0
0
0
0
69
100
30
100
132
58
38
16
%
None
3.2
50 Baht
0
50-80 Baht
57.3
80-110 Baht
31.1
110-150 Baht
0
>150 Baht
0
Based on skills
8.1
Total
100
Mean
Standard
deviation
Source: Field survey during 2009-2012.
Note: During the year 2009-2012, the annual average exchange rate was 31.90 Thai Baht
equivalent to 1 US$.
Likewise, respondents in Muang Mukdahan district of Thailand pay average daily wage
rate to immigrant labor almost 2 times higher than local wage rate in bordering Kaysone
Phomvihane district of Lao PDR. A fifth of respondents in Muang Mukdahan district of
Thailand offer more than 150 Baht per day. Almost a tenth of respondents pay 110 Baht to
150 Baht per day. There are very few respondents who compensate with 80 Baht to 110
Baht per day. Whereas, a third of respondents in Kaysone Phomvihane district of Lao PDR
pay local daily wage rates of 110 Baht to 150 Baht, a quarter of respondents compensate
with 80 Baht to 110 Baht per day. Less than a tenth of respondents compensate to both
Thai and South Korean technically skilled immigrant workers based on expertise.
Correspondingly, respondents in Maesod district of Thailand provide average daily wage
rates to immigrant labor 3 times higher than local wages in bordering Myawaddy district of
Myanmar. More than a third of respondents in Maesod district of Thailand pay daily wage
higher than 150 Baht. Almost a third of respondents compensate with 110 Baht to 150 Baht
per day. Almost a fifth of respondents disbursed daily wages of 50 Baht to 80 Baht.
Alternatively, many respondents pay wages to immigrant workers based on piece basis.
Whereas, 3 fifth of respondents in Myawaddy district of Myanmar pay local daily wage
rates of 50 Baht to 80 Baht, more than a tenth of respondents compensate local wage of
less than 50 Baht per day.
In relation to essential supports to those employed immigrant labor, most of respondents
across Thai border districts and in Kaysone Phomvihane district of Lao PDR provide
necessity for their working and living. For comparative analysis, 2 fifth of respondents in
Aranyaprathet district of Thailand provide either dormitories or health care to immigrant
labor and almost a fifth of respondents offer food. Similarly, 2 fifth of respondents in
Muang Mukdahan district of Thailand support the immigrants with health care,a third of
respondents provide dormitories, and a fifth of respondents render food. Moreover, most of
respondents in Kaysone Phomvihane district of Lao PDR provide dormitories and health
154
Positive impact
Cross-Border Region 3
2
The
F
0
%
0
F
0
Cam
%
0
F
0
%
0
F
0
%
0
F
0
%
0
F
0
Mya
%
0
14
33
19
27.5
0
0
17
1
40
2.3
0
0
0
0
38
4
55
5.7
0
0
0
0
11.5
0
0
0
0
11
43
0
26
100
2
56
61
3
92
100
0
0
69
0
0
100
0
0
0
0
0
0
1. Competent
communication of
neighboring countrys
language
2. Substitute shortage of
2
10
0
local Thai labor
3. Access to cheap labor
12
60
0
4. Reduce production
5
25
0
cost
5. Increase
1
5
0
competitiveness
6. Access to skilled
0
0
0
labor
7. Skill transfer
0
0
0
8. No-response
0
0
0
Total
20
100
0
Source: Field survey during 2009-2012.
Tha
Lao
Tha
The positive impacts of employing immigrant labor are relatively comparable across Thai
border districts, whereas, there is diversity of positive impacts in bordering Kaysone
Phomvihane district of Lao PDR. Respondents across Thai border districts of Muang
Mukdahan (40%), Maesod (55%) and Aranyaprathet (60%) expressed that they have
access to cheap migrant labor. Whereas, a few of respondents in Kaysone Phomvihane
district of Lao PDR stated access to skilled migrant labor, only a very small proportion of
respondents answered that they are fostering transfer of skill. For comparative analysis
across Thai border districts, a quarter of respondents in Aranyaprathet district informed of
reduction in production costs. A tenth of respondents mentioned that immigrant labor are
substituting the shortages of local Thai labor force. One respondent answered that it is
increasing competitiveness of border industries. Also, a third of respondents in Muang
Mukdahan district mentioned substituting shortages of local Thai labor force and one
respondent replied reducing production costs. Likewise, more than a quarter of
respondents in Maesod district replied substituting shortages of local Thai labor force and
a tenth of respondents said it is increasing competitiveness of border industries. A few of
respondents pointed out reduction of production costs.
18) Negative impacts of employing immigrant labor
Table 9.16 below presents the negative impacts of employing immigrant labor across three
cross-border regions.
155
1. Carry
communicable
diseases
2. Likely to commit
3
15
0
crime
3. Likely flee to
7
35
0
interior regions
4. Displace local jobs
0
0
0
4. No-response
6
30
0
Total
20
100
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
3
7
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
20
30
0
0
2.3
10
0
0
0
1
38
43
2.3
88
100
0
61
61
0
100
100
5
33
69
7.2
47.8
100
0
0
0
0
0
0
The negative impacts of employing immigrant labor meaningfully vary across Thai border
districts. Respondents across Thai border districts of Muang Mukdahan (12%), Maesod
(52.20%) and Aranyaprathet (70%) expressed that immigrant labor have negative impacts.
On the other hand, the rest of respondents across Thai border districts and all of
respondents in Kaysone Phomvihane district of Lao PDR have no response at all. For
comparative analysis across Thai border districts, slightly more than a third of respondents
in Aranyaprathet district indicated that immigrant labor are likely to flee into interior areas
of Thailand. More than a tenth of respondents replied that immigrant labor are either
carrying communicable diseases or likely to commit crime. Likewise, a few of respondents
in Muang Mukdahan district replied likely carrying communicable diseases. There are
very few respondents who stated that immigrant labor are either displacing local jobs or
likely to commit crime. Correspondingly, less than a third of respondents in Maesod
district indicated likely carrying communicable diseases, and a tenth of respondents
replied likely to commit crime. A few of respondents answered displacing local jobs or
occupations.
19) Voluntary turnovers of immigrant or local labor
Voluntary turnovers of either immigrant labor or local labor is becoming a notorious
problem across Thai border districts and some of the bordering districts. This problem
profoundly disrupts border industrial production activities. Respondents across Thai border
districts of Aranyaprathet (2.50%), Muang Mukdahan (2.50%) and Maesod (3.70%)
encountered higher average of turnover rates/month of immigrant labor. Likewise,
respondents in the 2 bordering districts of OChrov (2.50%) in Cambodia and Myawaddy
(2.75%) district in Myanmar stumbled upon slightly lower turnovers of local labor. On the
other hand, there is no turnover of either local or immigrant labor in Kaysone Phomvihane
district at all. For comparative analysis, 2 fifth of respondents in Aranyaprathet district of
Thailand and a fifth of respondents in Muang Mukdahan district of Thailand replied that
turnover rates of immigrant labor are less than 5% per month. Likewise, more than half of
respondents in OChrov district of Cambodia faced turnover of local labor less than 5% per
month.
Table 9.17 below presents voluntary turnovers of immigrant or local labor across three
cross-border regions.
156
Cross-Border Region 1
Tha
Cam
F
%
F
%
12
60
14
46.7
8
40
16
53.3
0
0
0
0
0
0
0
0
0
0
0
0
20
100 30
100
2.5
2.5
0
0
None
5 %
5-10 %
10-15 %
>15 %
Total
Mean
Standard
deviation
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
29
67
61
100
14
33
0
0
0
0
0
0
0
0
0
0
0
0
0
0
43
100 61
100
2.5
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
5.8
8
26.6
54
78.3
21
70
8
11.6
1
3.3
2
2.9
0
0
1
1.4
0
0
69
100
30
100
3.7
2.7
3
1
Remarkably, frequent voluntary turnover of immigrant labor has become the most
tarnishing crisis for border industrial developers in Maesod district of Thailand. Similarly,
turnover of local labor in Myawaddy district of Myanmar is also a trouble. Almost 4 fifth
of respondents in Maesod district of Thailand expressed that turnover rate of immigrant
labor is less than 5 % per month. A tenth of respondents informed of turnover rates at 5%
to 10% per month. Only a very small proportion of respondents who are confronted with
turnover rates at either 10% to 15% or higher than 15% per month. Moreover, more than 2
third of respondents in Myawaddy district of Myanmar came across turnover rate of local
labor of less than 5% per month. One respondent encountered turnover rate of local labor
at 5% to 10% per month.
20) Local backward linkage strategies
Local backward linkage strategies are significantly comparable across the cross-border
regions. Most of respondents across Thai border districts of Maesod (52%), Muang
Mukdahan (53%) and Aranyaprathet (75%) have local backward linkages. On the other
hand, 50%, 60% and 72% of respondents across the bordering districts of Myawaddy in
Myanmar, OChrov in Cambodia and Kaysone Phomvihane in Lao PDR are slightly
comparable in terms of local backward linkages. For comparative analysis, more
respondents in Aranyaprathet district of Thailand have local backward linkages than
counterpart respondents in bordering OChrov district of Cambodia. Two fifth of
respondents in Aranyaprathet district of Thailand are supplied with raw materials by local
farmers or local community-based enterprises. Less than a fifth of respondents are supplied
with raw materials by local firms. A tenth of respondents promote by either interacting
with local suppliers or sub-contracting or outsourcing of production activities and
processes to local border households. Similarly, 3 fifth of respondents in OChrov district
of Cambodia sub-contract or outsource production activities or processes to local border
households.
On the contrary, respondents in Kaysone Phomvihane district of Lao PDR have more local
backward linkages than counterpart respondents in bordering Muang Mukdahan district of
Thailand. Half of respondents in Kaysone Phomvihane district of Lao PDR are supplied
with raw materials by local border farmers. Less than a fifth of respondents are supplied
with intermediate products or components by local border firms. Few of respondents
interacted with local border suppliers.
157
Table 9.18 below presents local backward linkage strategies across three cross-border
regions.
Table 9.18 Local backward linkage strategies
Strategy
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
20
47
17
28
16
37
30
49
Cross-Border Region 3
Tha
Mya
F
%
F
%
33
48
15
50
11
16
1
3.3
9.3
3.3
2.9
60
4.6
1.6
12
17.4
2.3
4.3
3.3
15
10.1
10
33
1.6
1.6
9.9
1.4
100
43
100
61
100
69
100
30
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
5
25
12
40
8
40
0
0
1. None
2. Supplied with raw
materials by local
farmers or local
community-based
enterprises
3. Interacting with local
2
10
0
suppliers/ communitybased enterprises
4. Sub-contracting or
2
10
18
outsourcing of
production
activities/processes to
local firms/ communitybased
enterprises/households
5. Supplied with raw
3
15
0
materials by local
suppliers
6. Supplied with
0
0
0
intermediate products or
components by local
suppliers
7. Establish intra0
0
0
industry linkages
8. Supplying contracts
0
0
0
to local firms
9. Donating by-products
0
0
0
to local communitybased enterprises
Total
20
100
30
Source: Field survey during 2009-2012.
Only a very small proportion of respondents either supply contracts to local firms; subcontract or outsource production activities and processes to local border households; or
establish intra-industry linkages. On the other hand, more than a third of respondents in
Muang Mukdahan district of Thailand are supplied with raw materials by local border
farmers or local border community-based enterprises, and almost a tenth of respondents
interact with local border suppliers. Few of respondents sub-contract or outsource
production activities or processes to local border firms, and one respondent is supplied
with raw materials by local border firms.
158
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
33
77
10
16.4
1
2.2 45
73.7
Cross-Border Region 3
Tha
Mya
F
%
F
%
65
94
18
60
0
0
11
36.6
2.3
3.3
14
3.3
1.4
2.3
4.9
2.3
0
0
100
0
0
43
0
0
100
1
0
61
1.6
0
100
0
1
69
0
1.4
100
0
0
30
0
0
100
Cross-Border Region 1
Tha
Cam
F
%
F
%
19
95
17
56.6
0
0
13
43.3
1. None
2. Supplied with
intermediate products
and components by
border wholesalers or
firms
3. Sub-contracting or
1
5
0
outsourcing of
production
activities/processes to
border households
4. Supplied with raw
0
0
0
materials by border
firms
5. Interacting with
0
0
0
border suppliers or
community-based
enterprises
6. Supplying contracts
0
0
0
with border firms or
community based
enterprises
7. Skill training
0
0
0
8. Contract farming
0
0
0
Total
20 100
30
Source: Field survey during 2009-2012.
Cross-border production linkage strategies noticeably vary across the cross-border regions.
Considerably, more respondents across the bordering districts of Myawaddy (40%) in
Myanmar, OChrov (43.40%) in Cambodia and Kaysone Phomvihane (83.40%) in Lao
159
PDR have cross-border production linkage strategies. On the other hand, less number of
respondents across Thai border districts of Aranyaprathet (5%), Maesod (6%) and Muang
Mukdahan (23%) have cross-border production linkage strategies. This may have resulted
from lack of policy support to foster cross-border production linkages between Thailand
and these neighboring countries. For comparative analysis, less than half of respondents in
OChrov district of Cambodia are supplied with intermediate products and components by
wholesalers or firms from bordering Aranyaprathet district of Thailand. A respondent in
Aranyaprathet district of Thailand sub-contracts or outsources production activities or
processes to local households in bordering OChrov district of Cambodia.
On the contrary, almost 3 quarters of respondents in Kaysone Phomvihane district of Lao
PDR are supplied with intermediate products and components by border firms or
wholesalers from counterpart bordering Muang Mukdahan district of Thailand. Few of
respondents have either interacted with border suppliers or being supplied with raw
materials by border firms in Muang Mukdahan district of Thailand. A respondent is
accessing to cross-border skill training in Thailand. Whereas, more than a tenth of
respondents in Muang Mukdahan district of Thailand are supplied with raw materials by
border firms in Kaysone Phomvihane district of Lao PDR, a respondent is either supplied
with intermediate products and components by border firms or wholesalers; interacts with
border suppliers; supplies contracts with border firms or sub-contracts/outsources
production activities or processes to counterpart firms in bordering Kaysone Phomvihane
district of Lao PDR.
Likewise, slightly more than a third of respondents in Myawaddy district of Myanmar are
being supplied with intermediate products and components by counterpart border
wholesalers or firms from bordering Maesod district of Thailand. A respondent subcontracts or outsources production activities and processes from Maesod district to
bordering households in Myawaddy district of Myanmar. Similarly, a few of respondents
in Maesod district of Thailand sub-contract or outsource production activities or processes
to border households in bordering Myawaddy district of Myanmar. A respondent is either
supplied with raw materials by firms in bordering Myawaddy district of Myanmar or
undertakes cross-border contract farming with counterparts in bordering Myawaddy
district of Myanmar.
22) Production arrangements
Production arrangements considerably vary across the cross-border regions. Strikingly,
almost 3 quarters of respondents in Maesod district of Thailand are engaged in
domestically outsourced productions in the form of Original Equipment Manufacturer
(OEM) from Bangkok metropolis and its vicinity. On the other hand, respondents in the
other 2 Thai border districts of Aranyaprathet (93%) and Muang Mukdahan (95%) replied
of having diverse production arrangements such as producing their own brand or services.
Likewise, 17% to 97% of respondents across the bordering districts expressed that they
only produce their own brands or services. For comparative analysis, obviously more than
4 fifth of respondents in OChrov district of Cambodia are cross-border outsourced
productions from bordering Aranyaprathet district of Thailand. More than a tenth of
respondents replied that they only produce their own brand or services. One respondent in
Aranyaprathet district of Thailand is a locally outsourced production. On the contrary,
there are apparently common production arrangements in both Muang Mukdahan district
of Thailand and Kaysone Phomvihane district of Lao PDR, in which most of respondents
in both districts informed of producing their own brands or services. Moreover, a few of
160
respondents in both districts are doing domestically out-sourced productions. Table 9.20
below presents production arrangements across three cross-border regions.
Table 9.20 Production arrangements
Production
arrangement
Cross-Border Region 1
Tha
Cam
F
%
F
%
1
5
0
0
1. Either locally or
domestically
outsourced production
2. Cross-border
0
0
25
outsourced production
3. Produced only their
19
95
5
own brand/services
4. Both produced their
0
0
0
own brand and
outsourced production
Total
20 100 30
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
3
7
3
5
Cross-Border Region 3
Tha
Mya
F
%
F
%
49
71
0
0
83
17
40
93
58
95
16
23
29
97
100
43
100
61
100
69
100
30
100
Cross-Border Region
Cross-Border Region 1
Cross-Border Region 2
Tha
Cam
Tha
Lao
F
%
F
%
F
%
F
%
None
18
90
5
16.6
40
93
58
95
5
1
5
24
80
0
0
2
3.2
5-10
1
5
1
3.3
3
7
1
1.6
10-15
0
0
0
0
0
0
0
0
15-20
0
0
0
0
0
0
0
0
>20
0
0
0
0
0
0
0
0
Total
20
100 30
100
43
100
61
100
Mean
0.50
2.2
0.55
0.21
Standard
1.79
1.4
2.03
1.09
deviation
1
Source: Field survey during 2009-2012.
Cross-Border Region 3
Tha
Mya
F
%
F
%
16
23.2
29
97
42
60.8
1
3
8
11.6
0
0
1
1.4
0
0
1
1.4
0
0
1
1.4
0
0
69
100
30
100
4
0.1
7.3
0.5
Cross-Border Region 1
Tha
Cam
F
%
F
%
19
95
30 100
1
5
0
0
1. None
2. Joint venture
investment
3. Franchising
0
0
0
0
4. Contract farming
0
0
0
0
Total
20
100 30 100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
41
95
56
92
2
5
4
6
Cross-Border Region 3
Tha
Mya
F
%
F
%
68
98.6
30 100
0
0
0
0
0
0
43
0
1
69
0
0
100
1
0
30
2
0
100
0
1.4
100
0
0
0
0
0
0
Cross-border joint ventures are slightly existent across the cross-border regions. More
respondents across Thai border districts engage in cross-border investments, to some
extent, compared to those respondents across the bordering districts. There is no existing
162
cross-border joint venture investment both in bordering OChrov district of Cambodia and
Myawaddy district of Myanmar. However, the trend of cross-border joint venture is
promising as Thailand and neighboring countries are moving towards ASEAN
Community. For comparative analysis, a respondent in Aranyaprathet district of Thailand
had established cross-border investment venture particularly in casino business in
bordering OChrov district of Cambodia. Likewise, few of respondents in Muang
Mukdahan district of Thailand contract cross-border joint venture investment with Laotian
counterparts in bordering Kaysone Phomvihane district of Lao PDR, particularly in casino
business as well. Also, a few of respondents in Kaysone Phomvihane district managed
cross-border joint venture investment with the counterparts in bordering Muang Mukdahan
district of Thailand particularly in oil business. A respondent carries out franchising for
cement products from bordering Muang Mukdahan district of Thailand. Comparably, a
respondent in Maesod district of Thailand performs cross-border contract farming of sweet
corn for livestock in bordering Myawaddy district of Myanmar.
25) Market distributions of manufactured products or services provided
Table 9.23 below presents market distributions of manufactured products or services
provided across three cross-border regions.
Table 9.23 Market distributions of manufactured products or services provided
Market
Cross-Border Region 1
Tha
Cam
F
%
F
%
1. Local market
18
62.1
0
0
2. Domestic market
0
0
6
17.1
3. Bordering market
0
0
29
82.9
4. Cambodia
5
17.2
0
0
5. Myanmar
0
0
0
0
6. Vietnam
0
0
0
0
7. ASEAN
0
0
0
0
8. China
0
0
0
0
9. East Asia
0
0
0
0
10. USA
3
10.3
0
0
11. Europe
3
10.3
0
0
Total
29
100
35
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
42
72
46
55
0
0
29
35
15
26
4
5
0
0
0
0
0
0
0
0
0
0
3
4
1
2
0
0
0
0
1
1
0
0
0
0
0
0
0
0
0
0
0
0
58 100 83 100
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
0
0
52
49.5
18
46.2
0
0
21
53.8
0
0
0
0
1
1.5
0
0
0
0
0
0
3
2.9
0
0
0
0
0
0
9
8.6
0
0
16
15.2
0
0
24
22.9
0
0
105 100
39
100
Market distributions of manufactured products or services provided notably vary across the
cross-border regions. A certain degree of cross-border market interdependence is existing
across the cross-border regions. Respondents across Thai border districts clearly have
greater market diversifications ranging from local, bordering, domestic, regional and
international markets. On the other hand, respondents across the bordering districts have
lower market diversifications, which mainly concentrate on local, bordering and domestic
markets. Respondents in the 2 Thai border districts of Aranyaprathet (62.10%) and Muang
Mukdahan (72%) only cater to local markets. On the contrary, half of respondents in
Maesod district supply the whole Thailands domestic market. Another half of respondents
in Maesod district export to international markets, whereas, 55% of respondents in
Kaysone Phomvihane district of Lao PDR distribute to local market. Likewise, slightly
more than half of respondents in Myawaddy district of Myanmar export products to
markets in bordering Maesod district of Thailand.
163
1. None
2. Their own company
vehicle
3. Local cross-border
1
5
0
0
logistics services
4. Local cross-border
1
5
30 100
cart carriers
5. Local boat crossing
0
0
0
0
the river
6. Arranged by cross0
0
0
0
border buyers
7. By scheduled bus
0
0
0
0
crossing Thai-Lao
friendship bridge
Total
20 100 30 100
Source: Field survey during 2009-1012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
31
72
28
46
0
0
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
65
94.2
7
23.3
3
4.3
0
0
16
26
42
1.4
10
33.3
9.3
3.3
13
43.3
2.3
3.3
43
100
61
100
69
100
30
100
hand, significantly fewer respondents across Thai border districts of Maesod (1.40%),
Aranyaprathet (5%) and Muang Mukdahan (16%) rely on cross-border logistics. Ranging
from 23.30% to 94.20% of respondents across the cross-border regions do not engage any
cross-border logistics arrangements. This implies that this group of respondents may not
have any cross-border industrial linkages with counterparts in bordering cities.
For comparative analysis, all of respondents in OChrov district of Cambodia normally
employed cross-border cart services, while a fifth of respondents in Aranyaprathet district
of Thailand use their own company vehicles. One respondent utilizes either local crossborder logistics services or local cross-border cart carriers, which are mainly managed by
individual Cambodian cart services. Also, only a very small proportion of respondents in
both Muang Mukdahan district of Thailand and Kaysone Phomvihane district of Lao PDR
make arrangements through cross-border buyers or sellers. Less than half of respondents in
Kaysone Phomvihane district of Lao PDR utilize local cross-border logistics services. Few
of respondents use either scheduled bus crossing the Thai-Lao Friendship bridge or by boat
crossing the Mekong international river. Similarly, almost a fifth of respondents in Muang
Mukdahan district of Thailand utilize local cross-border logistics services and a tenth of
respondents use scheduled boat crossing Mekong international river. In comparison,
slightly more than 2 fifth of respondents in Myawaddy district of Myanmar utilize boat
crossing the Moei international river and a third of respondents utilize cross-border
logistics services. On the contrary, a few of respondents in Maesod district of Thailand use
their own company vehicles and one respondent relies on local cross-border logistics
services.
27) Forms of cross-border payments
Table of 9.25 below presents the forms of cross-border payments across three cross-border
regions.
Table 9.25 Forms of cross-border payment
Form of payment
Cross-Border Region 1
Tha
Cam
F
%
F
%
14
70
0
0
4
20
24
80
2
10
6
20
1. None
2. Cash
3. Money transfer to
suppliers in both cities
through local banks in
Thai border cities
4. Letter of Credit
0
0
0
0
5. Credit
0
0
0
0
Total
20 100 30
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
19
44
15
25
16
37
34
55.7
0
0
4
11.5
Cross-Border Region 3
Tha
Mya
F
%
F
%
65
94
9
30
4
6
21
70
0
0
0
0
7
1
30
0
0
69
16
2.3
100
7
1
61
11.5
1.6
100
0
0
100
0
0
30
0
0
100
The forms of cross-border payments in industrial trading significantly vary across the
cross-border regions depending on the extent of mutual trust with counterpart bordering
suppliers. Payment by cash is widely practiced across the bordering districts of Kaysone
Phomvihane (55.70%) in Lao PDR, Myawaddy (70%) in Myanmar and OChrov (80%) in
Cambodia. On the other hand, less number of respondents across Thai border districts of
Maesod (6%), Aranyaprathet (20%) and Muang Mukdahan (37%) use cash payment. For
comparative analysis, a fifth of respondents in OChrov district of Cambodia and a tenth of
165
%
F
35
0
60
30
5
0
0
0
100 30
0.000
%
0
100
0
0
100
Excellent
Good
Moderate
Poor
Total
Fisher
Exact
Test,
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
(River
(River
bridge)
bridge)
F
%
F
%
14
33
0
0
26
61
33
54
3
7
28
46
0
0
0
0
43 100 61 100
0.000
Cross-Border Region 3
Tha
Mya
(River
(River
bridge)
bridge)
F
%
F
%
12 17.4
2
6.6
47 68.1 20
66
9
13
6
20
1
1.4
2
6.6
69 100 30 100
0.29
Excellent
Good
Moderate
Poor
Total
Chi-Square
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
0
0
33
77
61 100
10
23
0
0
0
0
0
0
43 100 30 100
0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
2
2.9
0
0
58
84.1
0
0
9
13
24
80
0
0
6
20
69
100
30 100
0.000
Perceptions on border banking services drastically vary across the cross-border regions.
Overall, border banking services across Thai border districts are well developed than those
counterparts in the study bordering districts. A respondent in both Aranyaprathet and
Maesod districts of Thailand expresses excellent services. Pertaining to comparative
analysis, greater than 2 third of respondents in Aranyaprathet district of Thailand state
good satisfactions. A quarter of respondents say moderate satisfactions. Whereas, greater
than 3 fifth of respondents in OChrov district of Cambodia express moderate satisfactions.
Almost a third of respondents perceive good satisfactions. A little of respondents reply
poor satisfactions. In contrast, both slightly greater than 3 quarters of respondents in
Muang Mukdahan district of Thailand and all of respondents in Kaysone Phomvihane
district of Lao PDR reveal good satisfactions. Almost a quarter of respondents in Muang
Mukdahan district of Thailand state moderate satisfactions. Likewise, greater than 4 fifth
of respondents in Maesod district of Thailand perceive good satisfactions. Greater than a
tenth of respondents point out moderate satisfactions. Whereas, 4 fifth of respondents in
Myawaddy district of Myanmar express moderate satisfactions. A fifth of respondents state
poor satisfactions.
167
Chi-Square test is applied to the above table to understand similarities and differences
about the perceptions on border banking services across the regions.It is evident that
significant differences are observed in two cross-border regions (Aranyaprathet district of
Thailand and OChrov district of Cambodia, and Maesod district of Thailand and
Myawaddy district of Myanmar) as its p-values suggested there are significant at 99 % of
confidence level. Due to limited number of frequencies, Fisher Exact is alternatively
applied in the cross-border region of Muang Mukdahan district of Thailand and Kaysone
Phomvihane district of Lao PDR, which is found that its p-value similarly indicated there
is significant at 99 % of confidence level.
29) Perceptions on Border Customs, Immigration and Quarantine (CIQ) services
Table 9.28 below presents the perceptions on border customs, immigration and quarantine
services across three cross-border regions.
Table 9.28 Perceptions on Border Customs, Immigration and Quarantine (CIQ)
services
Opinion
Cross-Border Region 1
Tha
Cam
F
%
F
%
0
0
0
0
12
60
11
36.7
8
40
19
63.3
0
0
0
0
20 100 30
100
0.15
Excellent
Good
Moderate
Poor
Total
Chi-Square
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
0
0
0
0
30
70
61
100
9
21
0
0
4
9
0
0
43 100 61
100
0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
2
2.9
0
0
50
72.5
3
10
17
24.6
22
73
0
0
5
17
69
100
30 100
0.000
The perceptions on border customs, immigration and quarantine services noticeably vary
across the cross-border regions. Overall, border CIQ services across Thai border districts
are far more advanced than the counterpart bordering districts. Ranging from 60% to
72.50% of respondents across Thai border districts expressed good satisfaction. On the
other hand, 63.30% and 73% of respondents across the 2 bordering districts of OChrov in
Cambodia and Myawaddy in Myanmar, respectively, replied moderate satisfaction.
Moreover, all of respondents in Kaysone Phomvihane district of Lao PDR expressed good
satisfaction. For comparative analysis on perceptions on border CIQ services, 3 fifth of
respondents in Aranyaprathet district of Thailand expressed good satisfaction and 2 fifth of
respondents revealed moderate satisfaction. Whereas, 2 third of respondents in OChrov
district of Cambodia perceived moderate satisfaction, a third of respondents expressed
good satisfaction. Likewise, 2 third of respondents in Muang Mukdahan district of
Thailand answered good satisfaction and a fifth disclosed moderate satisfaction. A tenth of
respondents stated poor satisfaction. Correspondingly, a few of respondents in Maesod
district of Thailand expressed excellent satisfaction and almost 3 quarters revealed good
satisfaction. A quarter of respondents expressed moderate satisfaction. Whereas, almost 3
quarters of respondents in Myawaddy district of Myanmar stated moderate satisfaction,
almost a fifth perceived poor satisfaction, and a tenth informed good satisfaction.
168
Chi-Square test is applied to the above table to understand the similarities and differences
of the perceptions on border customs, immigration and quarantine services across the
cross-border regions. It is evident that significant differences are observed in two crossborder regions. There is a significant difference in the cross-border region of Muang
Mukdahan district of Thailand and Kaysone Phomvihane district of Lao PDR as its
p-value indicated significance at 99% confidence level. There is no significant difference
in the cross-border region of Aranyaprathet district of Thailand and OChrov district of
Cambodia as shown by its p-value. Due to limited number of frequencies, Fisher Exact is
alternatively applied in the cross-border region of Maesod district of Thailand and
Myawaddy district of Myanmar. The p-value similarly suggested there is significance at
99% confidence level.
9.2 Key Findings and Reflections
The following paragraphs summarize the preceding findings discussed in this chapter.
The industrial developer respondents across the Thai border districts have formal business
registrations as compared with the counterpart respondents in the bordering districts.
Interestingly, respondents across the bordering districts gain better investment incentives
from respective bordering governments than counterpart respondents across Thai border
districts. Respondents in Thai border districts make up the larger number of exogenous
industries. In contrast, respondents in 2 bordering districts make up the larger number of
endogenous industries. OChrov district of Cambodia hosts the largest number of
exogenous industries represented by 83.30% of respondents. Respondents across Thai
border districts mostly open new factories or services as they relocate in the border region.
Thai border districts have establishments operating in the average of more than 7 years.
Bordering districts of other countries have establishments recently operating (within last 4
years). Investment capital significantly varies across the cross-border regions.
Establishment of respondents in Thai border districts are mostly under the category of
small and medium sized enterprises (SMEs) with average capital investment of about 40
million Baht. This amount is much higher as compared to other districts of bordering
regions (e.g., Myawaddy district of Myanmar and Kaysone Phomvihane district of Lao
PDR). On the contrary, remarkably 96.70% of respondents in OChrov district of
Cambodia own informal micro-enterprises with investment capital just about 0.50 million
Baht.
The manufactured products or services provided significantly vary across the cross-border
regions. Generally, the Thai border districts are more industrialized than the 2 bordering
districts, except Kaysone Phomvihane district of Lao PDR, which is more industrialized
than the counterpart bordering Muang Mukdahan district of Thailand. Remarkably, major
productions are related to fashion industries in both Maesod district of Thailand
(specializing in high-end products) and OChrov district of Cambodia (specializing in lowend products). Outstandingly, four fifth of respondents in Maesod district of Thailand are
manufacturers of fashion goods, and two third of them produce high-end wearable apparels
and garments. About 10 percent of respondents make textile products. As a result, Maesod
district has become an important fashion cluster of Thailand and connected with the global
community chains. Sources of labor noticeably vary across the cross-border regions
depending on national and international division of labor. Respondents across Thai border
districts normally employ semi-skilled immigrant labor. On the contrary, respondents
across bordering districts mainly engage internal migrant labor. Cross-border movement
patterns of immigrant labor significantly vary across the cross-border regions.
169
There is an existing international division of immigrant labor by gender across Thai border
districts. Respondents across Thai border districts pay higher (1.6 to 3 times) wages to
immigrant labor than counterpart respondents in the bordering districts. A slightly higher
number of respondents across Thai border districts employ local backward linkages. This
implies that Thai border districts have more backward linkages than the counterparts in the
bordering districts. On the other hand, respondents across the bordering districts have more
cross-border production linkage strategies than the counterpart respondents in Thai border
districts. Strikingly, there is an existing spatial division of labor as reflected by almost 3
quarters of respondents in Maesod district of Thailand who arrange domestically
outsourced production in the form of Original Equipment Manufacturer (OEM) from
Bangkok metropolis and its vicinity. Regional and cross-border sub-contracting linkages
are significantly prevalent across the cross-border regions. There is an existing crossborder market interdependence in the studied cross-border regions.
It is evident that the local border industries are variably expanding and the types of
industries are rather diverse due to different resource endowments, costs of production, and
market orientation. Thai border industries gain easy access to relatively cheap immigrant
labor. As a result, it attracts a large number of industrial entrepreneurs to establish
productions along the border regions, particularly in Maesod district, where labor-intensive
industries for fashion goods are thriving. International and spatial division of labor are
noticeable in the Thai border districts. The border regions are optimistic that the local
cross-border industries will gradually expand fostering new regional production networks
in the ASEAN. Finally, the preceding key findings and reflections support the hypothesis
stating that cross-border trade regions are expected to gain infrastructural, economic, and
service benefits at the regional scale due to production and trading linkages.
170
CHAPTER 10
LOCAL CROSS-BORDER INTERACTIONS, EMPLOYMENT
AND HOUSEHOLD INCOME
This chapter features local cross-border interactions particularly on socio-economic
conditions at border household level. This chapter also describes how these local crossborder linkages contribute to sharing of employment and income along the cross-border
regions.
10.1 Compositions of Local Border Population
Women represents 43% to 79% of respondents across the cross-border regions. This is
primarily because at the time of interview most men already left their households and went
out for work. Then, the women respondents took the role in providing answers for the
research. Regarding marital status, 70.20% to 89.30 % of the respondents across the crossborder regions are already married. The respondents across the cross-border regions are of
working age with the average of 49 to 60 years old. The educational background of the
respondents significantly varies across the cross-border regions. The respondents across
Thai border districts have higher educational attainment than those counterpart respondents
across the bordering districts. Respondents (57.40% to 62.10%) across Thai border districts
completed higher primary school, whereas, 32.10% to 53.30% of respondents across the
bordering districts finished lower primary school. Respondents (17.14% to 22.80%) across
Thai border districts attained higher education levels, whereas, 1% to 6.70 % of
respondents across the bordering districts have lower education attainment. Therefore, the
number of illiterate respondents across Thai border districts is very low, ranging from
2.60% to 6.90%. On the contrary, there is quite high illiteracy among respondents across
the bordering districts, ranging from 20% to 32%.
10.2 Local Border Livelihoods
The features of local border livelihoods are described as follows:
1) Monthly income of border households
The monthly household income notably varies across the cross-border regions. The
monthly household income scales considerably vary with different distances from border
city centers across the cross-border regions. It is apparent that the nearer to the city center
the respondents settle, the higher household income is generated. However, it is notable
that a section of respondents across the cross-border regions are still facing poverty
incidence. The average monthly household income in the 2 Thai border districts of
Aranyaprathet and Maesod are generally almost 3 times higher than those counterpart
respondents in the bordering districts of OChrov district of Cambodia and Myawaddy
district of Myanmar. Also, the average monthly household income in Muang Mukdahan
district of Thailand is still 1.10 times higher than respondents in bordering Kaysone
Phomvihane district of Lao PDR. For comparative analysis, the average monthly
household income in Aranyaprathet district of Thailand is 13,629 Baht, whereas, the
average monthly household income in OChrov district of Cambodia is much lower at
5,204 Baht. The average monthly household income in Muang Mukdahan district of
Thailand is 11,049 Baht, whereas, the average monthly household income in bordering
Kaysone Phomvihane district of Lao PDR is slightly lower at 9,290 Baht. The average
monthly household income in Maesod district of Thailand is found the highest across Thai
171
border districts at 15,449 Baht, while the average monthly household income in Myawaddy
district of Myanmar is very much lower at 4,617 Baht.
In 2009, the official poverty line of Thailand was at 1,586 Baht/person/month. Likewise,
the international poverty line in 2008 was at 1.25 US$ at 2005 purchasing-power parity
(PPP). Therefore, poor households mainly living in rural areas with monthly income less
than 3,000 Baht/month are most prevalent across the bordering districts represented by
25.10%, 33.30% and 42.70% of respondents in Kaysone Phomvihane district of Lao PDR,
Myawaddy district of Myanmar, and OChrov district of Cambodia, respectively. On the
other hand, respondents across Thai border districts of Maesod (2.5%), Aranyaprathet
(10.30%) and Muang Mukdahan (21.80%) are found having lower household poverty
incidence. It should be noted that the broad range of standard deviations shown in the table
implies that some respondents may have underreported their monthly income. Details of
monthly border household income across three cross-border regions appear in Table 10.1.
Chi-Square test is applied to the above table to understand the similarities and differences
of the monthly border household income across the cross-border regions. It is evident that
significant differences are observed in two cross-border regions (Aranyaprathet district of
Thailand and OChrov district of Cambodia, and Maesod district of Thailand and Myawaddy
district of Myanmar) as its p-value indicated significance at 99% confidence level. On the
other hand, there is no significant difference in the cross-border region of Muang Mukdahan
district of Thailand and Kaysone Phomvihane district of Lao as indicated by its p-value.
2) Monthly expenses of border households
Respondents across the cross-border regions similarly have high burden of monthly
household expenses depending on varying zonal distances. It is also apparent that the
farther the respondents reside from the city centers, the lesser the monthly household
expenses they will incur. For comparative analysis, the average household expense in
Aranyaprathet district of Thailand is 6,276 Baht, whereas, the average household expense
in OChrov district of Cambodia is much lower at 3,034 Baht. The average monthly
household expense in Muang Mukdahan district of Thailand is 7,104 Baht, whereas, the
average monthly household expense in Kaysone Phomvihane district of Lao PDR is
slightly higher at 7,783 Baht due to high local living costs. The average monthly household
expense in Maesod district of Thailand is found the highest across the cross-border regions
at 12,545 Baht, while the average monthly household expense in Myawaddy district of
Myanmar is very much lower at 3,500 Baht. Details of monthly expenses of border
households across three cross-border regions appear in Table 10.2. It should be noted that
the broad range of standard deviations shown in the table implies that some respondents
may have underreported their monthly expenses.
3) Border family sizes
The border family sizes significantly vary across the cross-border regions. Respondents
across the bordering districts have more extended families than those counterpart
respondents across Thai border districts. The average number of family members across
the bordering districts is higher with 5 to 6 members, whereas, the average number of
members in a family across Thai border districts is lower with 4 members. For comparative
analysis, respondents across the 4 border districts are classified as extended families, in
which there are more than 6 members in a family. On the other hand, most of respondents
in Aranyaprathet district of Thailand and 4 fifth of respondents in OChrov district of
Cambodia are single families, in which there are less than 6 members in a family.
172
(Baht)
Cross-Border Region 1
Tha
Cam
F
%
F
%
6
10.3
44
42.7
25
43.1
53
51.5
28
48.3
6
5.8
58
100
103
100
13,629
5,204
8,341
5,875
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
22
21.8
40
25.1
43
42.6
63
39.6
36
35.6
56
35.2
101
100
159
100
11,049
9,290
10,142
8,266
Cross-Border Region 3
Tha
Mya
F
%
F
%
2
2.5
10
33.3
32
41.0
18
60.0
44
56.4
2
6.6
78
100
30
100
15,449
4,617
7,761
3,049
3,000 Baht
3,000 -15,000 Baht
>15,000 Baht
Total
Average (Baht)
Standard deviation
Chi Square p-value
0.000
0.79
0.000
Source: Field survey during 2009-2012.
Remarks: Tha-Cam: Aranyaprathet District/ OChrov District; Tha-Lao: Muang Mukdahan District/ Kaysone Phomvihane district;
Tha-Mya: Maesod District/ Myawaddy District
F means frequency.
173
173
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
26
26
40
25.1
26
26
42
26.4
24
24
21
13.2
1
1
10
6.2
4
4
11
6.9
6
5.9
7
4.4
14
14
28
17.6
101
100
159
100
7,104
7,783
5,972
6,359
Cross-Border Region 3
Tha
Mya
F
%
F
%
0
0
9
30
2
2.5
18
60
25
32
3
10
7
9
0
0
0
0
0
0
27
35
0
0
17
21.5
0
0
78
100
30
100
12,545
3,500
5,150
1,500
174
Cross-Border Region 1
Tha
Cam
F
%
F
%
2 members
7
12
7
6.8
2-4 members
31
53.4
38
36.9
4-6 members
19
32.8
37
35.9
6-8 members
1
1.7
14
13.6
8-10 members
0
0
5
4.9
>10 members
0
0
2
2
Total
58
100 103 100
Average
4
5
Standard deviation
1.4
2
Source: Field survey during 2009-1012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
8
7.9
7
4.4
57
56
52
32.7
28
28
55
34.6
8
8
29
18.2
0
0
9
5.6
0
0
7
4.4
101 100 159 100
4
6
1.5
2.3
Cross-Border Region 3
Tha
Mya
F
%
F
%
10
12.8
6
20
45
58
8
26.6
21
27
8
26.6
2
2.6
8
26.6
0
0
0
0
0
0
0
0
78
100
30
100
4
5
1.4
2.3
174
Also, more than 4 fifth of respondents in Muang Mukdahan district of Thailand and less
than 3 quarters of respondents in Kaysone Phomvihane district of Lao PDR are single
families.Moreover, more than a quarter of respondents in Kaysone Phomvihane district are
extended families. Similarly, most of respondents in Maesod district of Thailand and 3
quarters of respondents in Myawaddy district of Myanmar are single families. A few of
respondents in Maesod district are extended families and more than a quarter of
respondents in Myawaddy district are extended families. Details of border family sizes
across three cross-border regions are indicated in Table 10.3. Likewise, respondents across
the bordering districts have higher number of children and elderly in a family than those
counterpart respondents across Thai border districts. The average number of child and
elderly in a family across the bordering districts is represented with 2 members. On the
other hand, the average number of child and elderly in a family across Thai bordering
districts is shown with 1 member. This also means that respondents across the bordering
districts have higher number of dependents than counterpart respondents across Thai
border districts.
4) Home ownerships
Table 10.4 below presents home ownerships across three cross-border regions.
Table 10.4 Home ownerships
Home ownership
Cross-Border Region 1
Tha
Cam
F
%
F
%
52
89.7
64
62.1
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
86
85 139 87.4
Cross-Border Region 3
Tha
Mya
F
%
F
%
72
92
18
60
8.6
11
10.7
14
14
20
12.6
20
1.7
0
0
0
0
0
0
10
14
4
9.8
13.6
3.9
0
1
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
6
0
0
20
0
0
Total
58
100
103
Source: Field survey during 2009-1012.
100
101
100
159
100
78
100
30
100
Home ownerships vary very much across the cross-border regions. A higher (89.70% to
92%) number of respondents across Thai border districts are home owners, whereas, a
lesser number of respondents across the bordering districts of Myawaddy (60%) in
Myanmar and OChrov (62.10%) in Cambodia are home owners. There are also more
(87.40%) home owners among respondents in Kaysone Phomvihane district of Lao PDR.
For comparative analysis, most of respondents in Aranyaprathet district of Thailand have
their own houses, while less than a tenth of respondents rent houses. Only a very small
proportion of respondents live on government land. On the contrary, slightly more than 3
fifth of respondents in OChrov district of Cambodia have their own houses. Less than a
fifth of respondents reside on company shelters. A tenth of respondents either rent houses
or live in squatter settlements. Few of respondents stay with their parents or relatives.
Likewise, most of respondents in both Muang Mukdahan district of Thailand and Kaysone
Phomvihane district of Lao PDR own their houses. Slightly more than a tenth of
respondents in both cities rent houses. In comparison, most of respondents in Maesod
175
district of Thailand own their houses and a few of respondents rent houses. Whereas, more
than half of respondents in Myawaddy district of Myanmar own their houses, a fifth of
respondents either rent houses or live in squatter settlements.
5) Nativity and length of stay of border residents
Table 10.5 below presents nativity and length of stay of border residents across three crossborder regions.
Table 10.5 Nativity and length of stay of border residents
Length of
stay of
resident
Cross-Border Region 1
Tha
Cam
F
%
F
%
42
77.4
39
37.8
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
64
63
120
75.4
Native local
resident
10 years
2
3.4
39
37.7
10
10-20 years
6
10.3
15
14.4
19
20-30 years
0
0
10
9.6
8
>30 years
8
13.7
0
0
0
Total
58
100
103
100
101
Average
22
11
14
Standard
11
7.5
6
deviation
Source: Field survey during 2009-1012.
9.9
19
8
0
100
8
7
24
0
159
18
7
4.9
4.3
15
0
100
Cross-Border Region 3
Tha
Mya
F
%
F
%
43
55
13
43.3
8
24
3
0
78
14
6
10.2
30.8
3.8
0
100
16
1
0
0
30
8
1
53.3
3.3
0
0
100
Nativity and lengths of stay of residents considerably vary across the cross-border regions.
There are more native local residents among the respondents across Thai border districts of
Maesod (55%), Muang Mukdahan (63%) and Aranyaprathet (77.40%). On the other hand,
there are fewer native local residents among respondents across the 2 bordering districts of
OChrov (37.80%) in Cambodia and Myawaddy (43.30%) in Myanmar. Moreover, there is
also a higher (75.40%) number of native local residents among respondents in Kaysone
Phomvihane district of Lao PDR. For comparative analysis of non-native residents,
respondents across the Thai border districts generally have longer average length of stay
(14 years) in both Muang Mukdahan and Maesod districts while respondents in
Aranyaprathet district stay the longest (22 years). On the other hand, respondents in the 2
bordering districts have shorter average length of stay at 8 years and 11 years in
Myawaddy district of Myanmar and OChrov district of Cambodia, respectively.
Moreover, respondents in Kaysone Phomvihane district of Lao PDR are the longest (18
years) staying residents among the bordering districts.
6) Origin of non-native local residents
Origin patterns of non-native local residents are also diverse across the cross-border
regions. Ranging from 3.40% to 29.40% of respondents across Thai border districts have
migrated from other provinces within the region. On the other hand, respondents in the 3
bordering districts of Kaysone Phomvihane (5%) in Lao PDR, OChrov (22.30%) in
Cambodia and Myawaddy (46.60%) in Myanmar migrated from other regions. Slightly
few cross-border settlements are found across the cross-border regions. For comparative
analysis, respondents in OChrov district of Cambodia have broader origins than those
counterpart respondents in Aranyaprathet district of Thailand. Almost a third of
respondents in OChrov district come from other provinces in Northwestern region of
176
Cambodia. Almost a quarter of respondents migrate from other regions across Cambodia.
A few of respondents move from other districts in Banteay Meanchey province and only a
Table 10.6 below presents diverse origins of non-native local residents across three crossborder regions.
Table 10.6 Diverse origins of non-native local residents
Origin
Cross-Border Region 1
Tha
Cam
F
%
F
%
42
77.4
39
37.8
1
1.7
6
5.8
2
3.4
33
32
22.3
1.94
100
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
64
63 120 75.4
9
9
21
13.2
23
23
6
3.7
Cross-Border Region 3
Tha
Mya
F
%
F
%
43
55
13
43.3
11
14
1
3.3
23
29.4
2
6.6
3
2
101
0
1
78
3
2
100
8
4
159
5
2.5
100
0
1.2
100
14
0
30
177
46.6
0
100
(Rai)
Cross-Border Region 1
Tha
Cam
F
%
F
%
5
8.6
46
44.7
6
10.3
35
34
16
27.6
9
8.7
3
5.2
3
2.9
13
22.4
3
2.9
1
1.7
2
2.9
14
24.1
5
4.9
58
100 103 100
14
4.2
9.6
7.2
None
5 Rais
5-10 Rais
10-15 Rais
15-20 Rais
20-25 Rais
>25 Rais
Total
Mean
Standard
deviation
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
13
13
13
8.2
26
26 122 76.7
35
34
14
8.8
2
2
1
0.60
12
12
7
4.4
7
7
1
0.60
6
6
1
0.60
101 100 159 100
9
3.8
8.1
4.4
Cross-Border Region 3
Tha
Mya
F
%
F
%
3
3.8
14
46.6
4
5.1
7
23.3
34
43.6
9
36.6
2
2.6
0
0
28
36
0
0
0
0
0
0
7
9
0
0
78
100
30
100
13
3
7.2
3.4
178
Table 10.8 below presents the main sources of border household income across three crossborder regions.
Table 10.8 Main sources of border household income
Source of income
Cross-Border Region 1
Tha
Cam
F
%
F
%
27
46.5
30
29.1
1. Farming
activities
2. Grocery
15
25.9
7
6.7
3. Petty business
7
12.1
11
10.6
4. Individual sub0
0
8
7.7
contracted
industries/cottage
industries
5. Individual
1
1.7
7
6.7
service providers
6. Employee in
4
6.9
0
0
local industry
7. Government
2
3.4
1
1
service
8. Wage labor for
2
3.4
33
32
cross-border trade
9. Employee in
0
0
5
4.8
border casinos
10. Employee in
0
0
0
0
local services
11. Elderly relying
0
0
1
1
on remittances
Total
58
100
103
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
45
45
25
15.7
Cross-Border Region 3
Tha
Mya
F
%
F
%
41
52.6
9
30
15
30
2
15
29
2
0
81
3
0
51
1.9
7
19
1
9
24.4
1.3
3
2
1
10
6.7
3.3
2.5
6.7
6.7
31
19.5
1.3
11
36.7
2.5
11.5
0
101
0
100
3
159
1.9
100
0
78
0
100
0
30
0
100
A quarter of respondents run groceries and slightly more than a tenth of respondents are
petty business owners (e.g., laundry, coffee shop, photocopy center, etc.). A few of
respondents are employees in local industries and very few respondents are either
government employees, wage labor or individual service providers (e.g., local transport
services, etc.). Whereas, a third of respondents in bordering OChrov district of Cambodia
engage in general wage labor associated with cross-border trade, almost a third of
respondents involve in agricultural activities by mainly cultivating rice and cassava. A
tenth of respondents are business owners and less than a tenth of respondents involve in
either individual sub-contracted industries, individual service providers or running
groceries. A few of respondents are employed in border casinos.
Likewise, 2 fifth of respondents in Muang Mukdahan district of Thailand engage in
agricultural sector. More than a quarter of respondents are petty business owners and less
than a fifth of respondents run groceries. A few of respondents are general wage labor and
only a very small proportion of respondents are either in government service, cottage
industry or employed in local border industries. Whereas, half of respondents in adjacent
Kaysone Phomvihane district of Lao PDR engage in petty business, a fifth of respondents
serve as government employees. More than a tenth of respondents engage in agricultural
sector and a few of respondents involve in general wage labor. Few of respondents are
179
local service providers (e.g., transport, laundry and barber). There are very few
respondents who sustain their livelihoods either in cottage industries or handicraft and few
are elderlies relying on remittances. Concerning those respondents involved in agricultural
sector, almost 3 quarters of them in both districts grow rice. Less than a fifth of
respondents in Muang Mukdahan district plant cassava and few of respondents cultivate
either soybean or garlic. Only a very small proportion of respondents produce either corn
or mungbean. Moreover, a few of respondents in Kaysone Phomvihane district involve in
aquaculture.
Also, half of respondents in Maesod district of Thailand engage in farming activities for
their livelihoods and a quarter are petty business owners. A tenth of respondents engage in
local services (e.g., local transport, restaurants, barber and garage, etc.) and a few run
groceries. There are very few of respondents who are employed in either cottage industry,
handicraft or government service. Whereas, slightly more than a third of respondents in
bordering Myawaddy district of Myanmar are wage labor for cross-border trade, almost a
third of them involve in farming activities and a tenth operate groceries. A few of
respondents are either petty business owners, local transport service providers, or
employees in local industries. A respondent engages in cottage industry and handicrafts.
The respondents in both districts who engaged in farming activities grow similar kinds of
cash crops. More than a third of respondents in Maesod district of Thailand grow rice and
almost a fifth of respondents cultivate corn and sugarcane. A few of respondents produce
either garlic or mungbean. In comparison, almost a quarter of respondents in Myawaddy
district of Myanmar cultivate cassava. Almost a fifth of respondents grow either rice or
mungbean and a few produce either soybean, corn, or garlic.
9) Supplementary sources of border household income
Table 10.9 below presents the supplementary sources of border household income across
three cross-border regions.
Table 10.9 Supplementary sources of border household income
Source of income
Cross-Border Region 1
Tha
Cam
F
%
F
%
8
23.5
8
25
4
11.8
0
0
1
2.9
0
0
3
8.8
0
0
9
26.5
4
12.5
2
5.9
6
18.7
3
8.8
0
0
0
0
8
25
0
0
6
18.7
1. Farming activities
2. Livestock
3. Aquaculture
4. Horticulture
5. Grocery
6. Petty business
7. Service providers
8. Wage labor
9. Sub-contracted
industrial production/
cottage industry
10. Local industrial
0
0
0
0
employee
11. Local service
0
0
0
0
employee
Total
58
100
32
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
16
34
12
19.1
6
13
0
0
0
0
0
0
0
0
0
0
6
13
0
0
2
4.2 25
39.7
0
0
6
9.5
16
34
15
23.8
0
0
2
3.2
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
41.2
1
16.6
0
0
0
0
0
0
0
0
0
0
0
0
7
41.2
1
16.6
4
23.5
1
16.6
0
0
1
16.6
0
0
2
33.3
0
0
0
0
2.1
3.2
12
1.6
47
100
63
100
17
100
100
180
Supplementary sources of border household incomes considerably vary across the crossborder regions. Ranging from 25% to 50% of respondents across Thai border districts have
supplementary sources of border household income. On the other hand, 20% to 34% of
respondents across the bordering districts have supplementary sources of border household
income. For comparative analysis, half of respondents in Aranyaprathet district of Thailand
have supplementary sources of income. Out of this, a quarter of respondents engage either
in farming activities or groceries and a tenth involve in livestock. Almost a tenth of
respondents are either service providers or involve in horticulture, and a few are involve in
either aquaculture or petty business. Moreover, less than a fifth of respondents in OChrov
district of Cambodia have supplementary sources of income. Out of this, a quarter of
respondents are either general wage labor or engage farming activities. Almost a fifth of
respondents involve in either petty businesses or outsourced industrial productions.
Slightly more than a tenth of respondents operate groceries.
Similarly, almost half of respondents in Muang Mukdahan district of Thailand have
supplementary sources of income. Out of this, a third of respondents are either general
wage labor or engage farming activities and almost a quarter involve in farming activities.
A tenth of respondents engage in either livestock or groceries and few are either local
industrial employees or in petty business. Moreover, more than a third of respondents in
Kaysone Phomvihane district of Lao PDR have supplementary sources of border
household income. Out of this, more than a third of respondents are petty business owners
and almost a quarter are general wage labor. Almost a fifth of respondents involve in
farming activities and almost a tenth are local transport providers. Few of respondents are
either border industrial employees or running cottage industries and one respondent is a
local service employee.
In comparison, a quarter of respondents in Maesod district of Thailand have supplementary
sources of household income. Out of this, slightly more than 2 fifth of respondents operate
groceries and a quarter involve in either farming activities or petty business. Slightly more
than a tenth of respondents serve as employees of local border industries. Moreover, 2 fifth
of respondents in Myawaddy district of Myanmar have supplementary sources of
household income. Out of this, a third of respondents are general wage labor and less than
a fifth are either local transport providers or engage in horticulture, groceries, or petty
businesses.
10) Labor sources
Labor sources for carrying out labor-intensive agricultural activities (e.g., planting and
harvesting agricultural produce) or household works (e.g., maid and services of
waiters/waitress) significantly vary across the cross-border regions. Ranging from 81.50%
to 100% of respondents across the bordering districts work by themselves, whereas, 1% to
29.50% of respondents across Thai border districts hire immigrant labor force from
bordering countries. For comparative analysis, generally 2 third of respondents in
Aranyaprathet district of Thailand engage immigrant Cambodian labor force from adjacent
Banteay Meanchey province of Cambodia. More than a third of respondents secure wholly
unpaid family member labor force. A fifth of respondents wholly employ immigrant labor
force from bordering Banteay Meanchey province of Cambodia. One respondent employs
half local labor force and half immigrant labor force from bordering Banteay Meanchey
province. In contrast, 4 fifth of respondents in OChrov district of Cambodia wholly rely
on unpaid family member force. A fifth of respondents utilize half unpaid family member
labor force and employ half local labor force.
181
Table 10.10 below presents labor sources across three cross-border regions.
Table 10.10 Labor sources
Source of labor
Cross-Border Region 1
Tha
Cam
F
%
F
%
21
36.2
84
81.5
0
0
0
0
1. None employment
2. Totally hired local
labor
3. Half unpaid family 24
41.2
0
0
members and
employed half
immigrant labor from
bordering city
4. Wholly employed
12
20.7
0
0
immigrant labor from
bordering city
5. Employed half
1
1.7
0
0
local labor force and
half immigrant labor
from bordering city
0
0
19
18.4
6. Half unpaid family
members and
employed half
locally hired labor
force
Total
58
100
103
100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
83
82 132 96.8
11
11
5
3.1
Cross-Border Region 3
Tha
Mya
F
%
F
%
27
34.6
30
100
0
0
0
0
28
36
23
29.5
101
100
159
100
78
100
30
100
Also, more than 3 quarters of respondents in both Muang Mukdahan district of Thailand
and most of respondents in Kaysone Phomvihane district of Lao PDR engage wholly
unpaid family member labor force. A tenth of respondents in Muang Mukdahan district in
Thailand and a few of respondents in Kaysone Phomvihane district in Lao PDR totally hire
local labor force. In Muang Mukdahan district of Thailand alone, a few of respondents
engage half unpaid family member labor force and employ half immigrant labor from
bordering Savannakhet province of Lao PDR. A few of respondents involve half unpaid
family member labor force and employ half local labor force. There are very few
respondents either wholly employ immigrant labor from Savannakhet province of Lao
PDR or engage half local labor force.
Correspondingly, a third of respondents in Maesod district of Thailand and all of
respondents in Myawaddy district of Myanmar fully engage unpaid family member labor
force. In Maesod district of Thailand alone, slightly more than a third of respondents
employ both half immigrant labor force from bordering Myawaddy district of Myanmar
and half unpaid family member labor force. More than a quarter of respondents fully hire
immigrant labor from bordering Myawaddy district of Myanmar.
11) Employment of immigrant labor by border households
Table 10.11 below presents employment of immigrant labor by border households across
Thai border regions.
182
None
5 workers
5-15 workers
15-25 workers
Total
Mean
Standard
deviation
Chi Square
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Cross-Border Region 3
Tha
Lao
Tha
Mya
F
%
F
%
F
%
F
%
101 100 0
0
27
34.6
0
0
0
0
0
0
1
1.3
0
0
0
0
0
0
15
19.2
0
0
0
0
0
0
35
45
0
0
101 100 0
0
78
100
0
0
2
0
19
0
0
0
6.5
0
0.000
Only respondents across Thai border districts notably engage varying numbers of
immigrant labor. Respondents in Maesod district employ the highest average number of
immigrant labor with 19 workers followed by respondents in Aranyaprathet district who
mostly engage unregistered immigrant labor averaging 9 workers. Whereas, a few of
respondents in Muang Mukdahan district employ the lowest number of registered
immigrant labor averaging 2 workers, almost half of respondents in Aranyaprathet district
employ 5 to 15 immigrant labor. A tenth of respondents hire fewer than 5 workers and a
few of respondents engage 15 to 25 immigrant workers. Likewise, a few of respondents in
Muang Mukdahan district employ less than 5 immigrant workers. Similarly, more than half
of respondents in Maesod district hire unregistered immigrant labor, while a tenth of
respondents employ registered labor. Out of this, almost half of respondents in Maesod
district hire 15 to 25 immigrant workers and a fifth of respondents engage 5 to 15
immigrant workers. A respondent employs less than 5 workers. Chi-Square test is applied
to the above table to understand the similarities and differences about the employment of
immigrant labor by Thai border households. It is evident that significant differences are
observed across Thai border regions as its p-value indicated significance at 99%
confidence level.
12) Reasons for employing immigrant labor
Reasons for employing immigrant labor really vary across Thai border districts.
Respondents across Thai border districts of Muang Mukdahan (1%), Aranyaprathet
(29.40%) and Maesod (32.70%) expressed that labor in their districts are cheap, so they
can reduce production costs. A fifth of respondents in Aranyaprathet district expressed that
there is shortage of Thai labor force in their locality. Slightly more than a tenth of
respondents mentioned that local Thai labor force is choosy with jobs. Also, few of
respondents in Muang Mukdahan district replied that local Thai labor force is selective
with jobs. Similarly, a third of respondents in Maesod district indicated that local Thai
labor force is choosy with jobs and a few of respondents replied that there are shortages of
Thai labor force in Maesod district.
Table 10.12 below presents the reasons for employing immigrant labor across Thai border
regions.
183
1. None employment of
immigrant labor at all
2. Local Thai labor force
7
12
0
is choosy with jobs.
3. Shortage of Thai
11
18.9 0
labor force in their city.
4.Immigrant labor in
19
32.7 0
their city is cheap, so
they can reduce cost of
production
Total
58
100
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
97
96
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
27
34.6 0
0
23
29.4
5.12
23
29.4
101
100
78
100
Cross-border movement patterns of labor vary very much across Thai border districts
depending on whether a conducive policy on facilitation of cross-border movement of
labor is existing or not. For instance, more than a third of respondents in Aranyaprathet
district especially mentioned daily cross-border movement, because it is a pilot area for
allowing daily movement of labor between Thailand and Cambodia. Almost a fifth of
respondents informed seasonal immigration and and very few of respondents replied longterm immigration with all family members. Also, only a very small proportion of
respondents in Muang Mukdahan district stated either seasonal immigration, circular
immigration or long-term immigration with all family members. Likewise, almost half of
respondents in Maesod district indicated seasonal immigration. A tenth of respondents
expressed long-term immigration with all family members, and a few of respondents
informed either daily basis or circular movement.
13) Gender ratios of immigrant labor
Table 10.13 below presents gender ratios of immigrant labor across Thai border regions.
Table 10.13 Gender ratios of immigrant labor
Ratio of men and
women immigrant
labor
Cross-Border Region 1
Tha
Cam
F
%
F
%
None employment
21
36.2
0
0
50:50
33
56.9
0
0
25:75
2
3.4
0
0
75%:25%
0
0
0
0
100% male labor
2
3.4
0
0
100% female labor
0
0
0
0
Total
58
100
0
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
97
96
0
0
3
3
0
0
0
0
0
0
0
0
0
0
1
1
0
0
0
0
0
0
101 100
0
0
Cross-Border Region 3
Tha
Mya
F
%
F %
27
34.6 0 0
12
15.4 0 0
14
18
0 0
18
23
0 0
2
2.6
0 0
5
6.4
0 0
54
100
0 0
Gender of immigrant labor largely varies across Thai border districts depending on
international division of labor by gender differences. Male labor always carry outdoor jobs,
whereas, female labor perform either indoor or outdoor jobs. More than half of respondents
in Aranyaprathet district hire equal number of men and women with the proportion of
184
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
97
96
0
0
0
0
0
0
2
2
0
0
2
2
0
0
101 100
0
0
113
0
17.5
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
27
34.6
0
0
26
33.3
0
0
25
32
0
0
0
0
0
0
78
100
0
0
80
0
14.
0
9
Non-employment
50-80 Baht
80-110 Baht
110-150 Baht
Total
Mean
Standard
deviation
Source: Field survey during 2009-2012.
Note: During the year 2009-2012, the annual average exchange rate was 31.90 Thai Baht
equivalent to 1 US$.
The average daily wage rates of immigrant labor across Thai border districts slightly vary
at 80 Baht, 113 Baht and 118 Baht in Maesod, Muang Mukdahan and Aranyaprathet
districts, respectively. For comparative analysis, fewer than half of respondents in
Aranyaprathet district remunerate with 110 Baht to 150 Baht per day. Less than a fifth of
respondents compensate with 80 Baht to 110 Baht per day and a few of respondents pay 50
Baht to 80 Baht per day. Likewise, few of respondents in Muang Mukdahan district pay
daily wage rates of either 80 Baht to 110 Baht or 110 Baht to 150 Baht. Moreover, half of
respondents in Maesod district pay lower daily wage rates of either 50 Baht to 80 Baht or
80 Baht to 110 Baht.
15) Family members crossing border for jobs in Thailand
Only respondents across the bordering districts cross the border to seek jobs in Thailand.
Respondents in Myawaddy district of Myanmar who replied that some family members
cross the border for jobs in Thailand, represent the highest number of respondents
(83.40%) followed by OChrov district (65.10%) of Cambodia and Kaysone Phomvihane
district (23.90%).Table 10.15 below presents the number of family members crossing
border for jobs in Thailand.
185
Table 10.15 Number of family members crossing border for jobs in Thailand
Number
Cross-Border Region 1
Tha
Cam
F %
F
%
0 0
36
34.9
0 0
46
44.6
0 0
14
13.5
0 0
7
6.7
0 0 103
100
0
1.3
0
1.3
None
1 member
2-3 members
4-5 members
Total
Mean
Standard
deviation
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F %
F
%
0
0
121
76.1
0
0
35
22
0
0
3
1.8
0
0
0
0
0
0
159
100
0
0.65
0
0.53
Cross-Border Region 3
Tha
Mya
F %
F
%
0 0
5
16.6
0 0
20
66.6
0 0
5
16.6
0 0
0
0
0 0
30
0
0
0.9
0
0.8
The average number of family members crossing the border for jobs across the bordering
districts is 1 person/family. For comparative analysis, less than half of respondents in
OChrov district of Cambodia have 1 member seeking for jobs in bordering Aranyaprathet
district of Thailand. Less than a tenth of respondents have 2 to 3 members, less than a tenth
have 4 to 5 members, and slightly more than a third of respondents have none at all. Also,
almost a quarter of respondents in Kaysone Phomvihane district of Lao PDR have 1 family
member seeking for jobs in Thailand. Only a very small proportion of respondents have 2
family members and 3 quarters of respondents have none at all. In comparison, 2 third of
respondents in Myawaddy district of Myanmar have 1 member crossing the border for jobs
in Thailand. Almost a fifth of respondents have 2 to 3 members and almost a tenth of
respondents have none at all.
In connection with immigrant destinations, respondents in both OChrov district of
Cambodia and Myawaddy district of Myanmar have rather similar pattern of migration.
Three fifth of respondents in OChrov district and 2 third of respondents in Myawaddy
district replied that they migrate to adjacent Thai border districts due to close geographical
proximity. Also, almost a fifth of respondents in Myawaddy district and a few of
respondents in OChrov district seek for jobs in Bangkok metropolis and its vicinity. There
are very few respondents in OChrov district who answered that they migrate to
neighboring provinces in Thailand. Likewise, more than a tenth of respondents in Kaysone
Phomvihane district of Lao PDR stated going to Bangkok metropolis and its vicinity in
Thailand. Almost a tenth of respondents expressed migrating to bordering Muang
Mukdahan district and only a very small proportion of respondents expressed immigrating
to the industrial Eastern region in Thailand.
16) Involvements with border community-based enterprises
Involvements with border community-based enterprises largely vary across the crossborder regions. Respondents across Thai border districts are well established with various
types of community-based enterprises, whereas, such activities are non-existent across the
bordering districts. Respondents across the Thai border districts of Muang Mukdahan
(29%), Aranyaprathet (29.30%) and Maesod (47.40%) have engaged with border
community-based enterprises. Out of this number, more than a quarter of respondents in
Maesod district engage with cooperatives.
Table 10.16 below presents involvements with border community-based enterprises across
three cross-border regions.
186
Cross-Border Region 1
Tha
Cam
F
%
F
%
41
70.7
0
0
7
12.1
0
0
7
12.1
0
0
3
5.2
0
0
1. None
2. Cooperatives
3. Farmer organization
4. One Tambon (Subdistrict) One Product
(OTOP)
5. Women occupation
0
0
0
groups
6. Community saving
0
0
0
groups
Total
58
100
0
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
72
71
0
0
14
14
0
0
8
8
0
0
3
3
0
0
Cross-Border Region 3
Tha
Mya
F
%
F
%
41
52.6 0
0
22
28.2 0
0
7
9
0
0
8
10.3 0
0
101
100
78
100
A tenth of respondents involve with One Tambon (Sub-District) One Product (OTOP)
program and a few of respondents connect with local farmer organizations. Similarly,
slightly more than a tenth of respondents in Aranyaprathet district are members of either
cooperatives or famer organizations. A few of respondents participate in One Tambon One
Product (OTOP) program. Also, less than a fifth of respondents in Muang Mukdahan
district are members of cooperatives and a few of respondents are members of local farmer
organizations. A few of respondents engage in either One Tambon One Product (OTOP)
program or local women occupation groups. A respondent joins the community saving
group.
Out of those respondents across Thai border districts who are involved with border
community-based enterprises, 4.50%, 15% and 25.70% of them in Aranyaprathet, Muang
Mukdahan and Maesod districts have established local community enterprise linkage
strategies. Among other strategies, respondents in Aranyaprathet (1.70%), Muang
Mukdahan (8%) and Maesod (15.40%) districts are supplying raw materials to local border
industries. A respondent in Aranyaprathet district buys intermediate goods from local
traders. Likewise, a few of respondents in Muang Mukdahan district and less than a tenth
of respondents in Maesod district supply wage labor to local border industries. A few of
respondents in Muang Mukdahan district and very few respondents in Maesod district
supply intermediate products and components to local border industries.
17) Perceptions on condition of secondary or district road during the past 10 years
Perceptions on condition of secondary road during the past 10 years greatly vary across the
cross-border region. Respondents across Thai border districts of Maesod (7.70%), Muang
Mukdahan (11%) and Aranyaprathet (20.60%) perceived that the secondary or district
roads are in good condition during the past 10 years. On the other hand, roads across the
bordering districts are in very much poorer condition. For comparative analysis, slightly
more than half of respondents in Aranyaprathet district of Thailand replied poor condition
and a quarter of respondents said moderate condition. On the other hand, all respondents in
OChrov district of Cambodia replied poor condition.
Table 10.17 below presents perceptions on conditions of secondary or district road during
the last 10 years across three cross-border regions.
187
Table 10.17 Perceptions on conditions of secondary or district road during the last 10
years
Opinion
Cross-Border Region 1
Tha
Cam
F
%
F
%
32
55.2 103 100
14
24.1
0
0
12
20.6
0
0
58
100 103 100
0.000
Poor
Moderate
Good
Total
Chi Square
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
56
55 154 97
34
34
2
1
11
11
3
2
101 100 159 100
0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
49
62.8
30
100
23
29.5
0
0
6
7.7
0
0
78
100
30
100
0.000
Poor
Moderate
Good
Excellent
Total
Chi-Square
p-value
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
14
14
1
0.6
70
69 155 97.5
15
15
3
2
2
2
0
0
101 100 159 100
0.000
Cross-Border Region 3
Tha
Mya
F
%
F
%
17
21.8
26
86.6
37
47.4
4
13.3
21
27
0
0
3
4
0
0
78
100
30
100
0.000
189
Table 10.19 below presents the types of current community road in three cross-border
regions.
Table 10.19 Types of current community road
Type of road
Cross-Border Region 1
Tha
Cam
F
%
F
%
0
0
0
0
Gravel
Dirt road
0
0
65 63.1
Concrete road
16
27.5
4
3.8
Asphalt road
42
72.4
34
33
Total
58
100 103 100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
2
2
4
2.5
Cross-Border Region 3
Tha
Mya
F
%
F
%
4
5.12
15
50
10
33.2
58
41
30
57
41
100
11
144
159
7
90.5
100
54
20
78
69.2
25
100
0
5
30
0
16.6
100
Whereas, most of respondents in Kaysone Phomvihane district of Lao PDR told of asphalt
road, a few of respondents informed of concrete road. Only a very small proportion of
respondents replied gravel road. In comparison, a third of respondents in Maesod district of
Thailand replied concrete road,a quarter informed of asphalt road, and a few of
respondents identified gravel road. Whereas, more than 4 fifth of respondents in
Myawaddy district of Myanmar answered gravel road which cant be used at all seasons,
almost a tenth of respondents replied asphalt road.
Therefore, current conditions of community roads across Thai border districts are very
much improved compared with bordering districts. For comparative analysis, more than 2
third of respondents in Aranyaprathet district of Thailand expressed good condition and a
tenth of respondents answered either moderate or excellent condition. There are very few
respondents who stated poor condition. On the contrary, less than half of respondents in
OChrov district of Cambodia expressed poor condition and a third of respondents
answered moderate condition. Slightly more than a tenth of respondents stated excellent
condition and a tenth of respondents replied good condition. Likewise, more than half of
respondents in both Muang Mukdahan district of Thailand and Kaysone Phomvihane
district of Lao PDR stated good condition. Less than a fifth of respondents in Muang
Mukdahan district expressed moderate condition and slightly more than a tenth of
respondents told of excellent condition. A few of respondents revealed poor condition.
Moreover, few of respondents in Kaysone Phomvihane district stated either moderate or
poor condition. Correspondingly, almost a third of respondents in Maesod district of
Thailand perceived either excellent or moderate condition and slightly a quarter of
respondents replied good condition. More than a tenth of respondents informed of poor
condition. Whereas, 2 third of respondents in Myawaddy district of Myanmar expressed
poor condition, a fifth of respondents replied moderate conditions, and more than a tenth of
respondents answered good condition.
20) Marketing channels of border agricultural commodities
Marketing channels of border agricultural commodities largely vary across the crossborder regions. Most of respondents across Thai border districts who are engaged in
agricultural activities are market-oriented farmers. On the other hand, most of respondents
across the bordering districts who are engaged in farming activities are subsistent farmers.
For comparative analysis of marketing channels of local agricultural produce, almost half
of respondents in Aranyaprathet district of Thailand sell to the local intermediary border
traders.
190
Table 10.20 below presents the marketing channels of border agricultural commodities
across three cross-border regions.
Table 10.20 Marketing channels of border agricultural commodities
Marketing channel
Cross-Border Region 1
Tha
Cam
F
%
F
%
26
45
73
71
1. Not engaged in
farming activity.
2. Totally keep for
0
0
7
7
own consumption.
3. Partly keeps for own
0
0
2
2
consumption and
partly sells to
middleman at the
farms.
4. Sells to local
1
1
0
0
industries.
5. Sells to the
27
47
16
15
intermediary border
traders at the farms.
6. Sells at local
4
7
5
5
periodic markets
7. Sells to cross-border
0
0
0
0
buyers in bordering
city.
Total
58
100 103 100
Source: Field survey during 2009-2012.
Cross-Border Region
Cross-Border Region 2
Tha
Lao
F
%
F
%
56
55 126 79.2
Cross-Border Region 3
Tha
Mya
F
%
F
%
31
40
21
70
3.8
10
19
19
26
16.3
13.3
10
10
3.9
0.6
29
37.2
6.66
13
16.7
2.6
101
100
30
100
78
100
30
100
A few of respondents either sell at local periodic markets or supply to local border
industries. On the contrary, less than a fifth of respondents in OChrov district of
Cambodia sell to intermediary border traders. Less than a tenth of respondents totally keep
for their own consumption and a few of respondents sell at local periodic markets. Only a
very small proportion of respondents partly keep for own consumption and partly sell to
the intermediary border traders at the farms.
Also, a fifth of respondents in Muang Mukdahan district of Thailand manage by partly
keeping for their own consumption and partly selling to the middlemen at the farms.
Almost a quarter of respondents sell to local border industries. A tenth of respondents
totally keep for their own consumption, which is mostly at subsistent level. Less than a
tenth of respondents sell to the intermediary border traders at the farms. Moreover, less
than a fifth of respondents in Kaysone Phomvihane district administer by both partly
keeping for their own consumption and partly selling to the intermediary border traders at
the farms. A few of respondents totally keep for their own consumption and one
respondent sells to the intermediary border trader.
In comparison, almost 2 fifth of respondents in Maesod district of Thailand sell agricultural
commodities to the intermediary border traders. Almost a fifth of respondents sell at the
periodic markets either in village or in sub-district. A few of respondents either trade to
buyers in bordering Myawaddy district of Myanmar or sell to local border rice mills.
Moreover, more than a tenth of respondents in Myawaddy district of Myanmar manage by
191
partly keeping for their own consumption and partly selling to the intermediary border
traders at the farms. A tenth of respondents only keep for their own consumption and a few
of respondents sell to the intermediary border traders at the farms.
21) Benefits gained by local border households after opening of the border during the
last 5 years.
Table 10.21 below presents the benefits gained by local border households across three
cross-border regions after opening of the border during the last 5 years.
Table 10.21 Benefits gained by local border households after opening of the border
during the last 5 years
Level of
Cross-Border Region
gaining
Cross-Border Region 1
Cross-Border Region 2
Cross-Border Region 3
benefit
Tha
Cam
%
F
%
8.62
9
8.73
63.7
28
27.1
20.6
22
8
6.8
31
30
0
13
12.6
100 103 100
0.000
F
Not at all
5
Low
37
Moderate
12
High
4
Very high
0
Total
58
ChSquare
p-value
Source: Field survey during 2009-2012.
Tha
F
29
41
22
7
2
101
%
29
40
22
7
2
100
Lao
F
1
18
98
38
4
159
0.000
%
0.6
11.3
61.6
24
2.5
100
Tha
F
16
26
34
2
0
78
Mya
%
F
%
20.5
2
6.6
33.3
5
16.6
43.6
15
50
2.6
8
26.6
0
0
0
100
30
100
0.000
respondents expressed that they gained low social and economic benefits. In contrast, a
tenth of respondents in both cities gained neither economic nor social benefits. On the
contrary, respondents in Kaysone Phomvihane district of Lao PDR gained greater
economic and social benefits than counterpart respondents in bordering Muang Mukdahan
district of Thailand. More than half of respondents in Kaysone Phomvihane district reaped
moderate economic and social benefits. Almost a quarter of respondents obtained high
economic benefits and a tenth of respondents received low economic and social benefits.
There are very few respondents who acquired very high economic benefits, particularly on
cross-border trade. A respondent gained neither economic nor social benefit. Whereas, 2
fifth of respondents in Muang Mukdahan district of Thailand obtained low economic and
social benefits, almost a quarter of respondents secured moderate economic and social
benefits, and a few of respondents gained high economic benefits. Only a very small
proportion of respondents reaped very high economic benefits. In contrast, more than a
quarter of respondents in Muang Mukdahan district gained neither economic nor social
benefit.
Correspondingly, respondents in Myawaddy district of Myanmar gained greater economic
and social benefits than counterpart respondents in the bordering Maesod district of
Thailand. Almost half of respondents in Maesod district of Thailand reaped moderate
social and economic benefits (e.g., easy crossing the border and access to cheap migrant
labor). A few of respondents in Maesod district obtained high level of economic benefits.
A third of respondents secured low level of economic and social benefits and a fifth of
respondents in Maesod district gained neither economic nor social benefit. Likewise, half
of respondents in Myawaddy district of Myanmar obtained moderate social and economic
benefits (e.g., access to cross-border health care and jobs). Slightly more than a quarter of
respondents in Myawaddy district reaped high economic benefits, either as a border trader,
cross-border trade-related laborer or cross-border shopper. Almost a fifth of respondents
earned low economic and social benefits and a few of respondents gained neither economic
nor social benefit. Chi-Square test is applied to the above table to understand the
similarities and differences of the benefits gained by local border households across the
cross-border regions after opening of the border during the last 5 years. It is obvious that
significant differences are observed across the cross-border regions as its p-value indicated
significance at 99% confidence level.
10.3 Key Findings and Reflections
This section intends to consistently highlight the preceding findings from the local border
household surveys. It also summarizes the local cross-border interactions particularly on
border socio-economic conditions through the paragraphs that follow.
Women respondents are largely (43% to 79%) represented across the cross-border regions.
Ranging from 70.20% to 89.30% of the respondents across the cross-border regions are
already married. The respondents across the cross-border regions are of working age with
the average of 49 to 60 years old. Respondents across Thai border districts have higher
educational attainment than the counterpart respondents in the bordering districts.
Therefore, the number of illiterate respondents across Thai border districts is very low,
ranging from 2.60% to 6.90%. On the contrary, there is quite high illiteracy across the
bordering districts, ranging from 20% to 32% of the respondents. The monthly household
income notably varies across the cross-border regions depending on the distance of
residence from the city. The nearer the residence is to the city, the higher household
193
income is generated. The monthly household income of respondents across Thai border
districts is generally higher (1.1 to 3 times) than counterpart respondents in the bordering
districts. It is notable that a section of respondents across the cross-border regions are still
facing poverty incidence.
In 2008, the international poverty line was at $1.25, at 2005 purchasing-power parity
(PPP). Therefore, poor households mainly living in rural areas with monthly income less
than 3,000 Baht/month are most prevalent across the bordering districts represented by
25.10%, 33.30% and 42.70% of respondents in Kaysone Phomvihane district of Lao PDR,
Myawaddy district of Myanmar and OChrov district of Cambodia, respectively. On the
other hand, 10.30% and 21.80% of respondents in the 2 Thai border districts of
Aranyaprathet and Muang Mukdahan, respectively, are found having lower household
poverty incidence. Similarly, rather poor households with monthly income of 3,000 Baht to
7,000 Baht also have higher incidence in bordering districts of Kaysone Phomvihane
(26.40%) in Lao PDR, OChrov (39.80%) in Cambodia and Myawaddy (43.30%) in
Myanmar. In contrast, respondents in Thai border districts of Maesod (2.60%),
Aranyaprathet (8.6%), and Muang Mukdahan (18%) revealed lower incidence of rather
poor border households. Respondents across the cross-border regions similarly have high
burden of monthly household expenses, depending on varying zonal distances. This means,
respondents residing in farther distances from the city incur lesser monthly household
expenses.
Respondents across the bordering districts have larger extended families than counterpart
respondents in Thai border districts. Respondents across Thai border districts have higher
number of native residents than counterpart respondents in the bordering districts.
Furthermore, respondents across Thai border districts have lower number of landless
households than the counterpart respondents across the bordering districts. The main
sources of border household income considerably vary across the cross-border regions.
There are complementary linkages of household income sources between Thai border
districts and the bordering districts, particularly on labor and cross-border outsourcing
activities. Respondents who live in the cities across Thai border districts and in Kaysone
Phomvihane district of Lao PDR mostly engage in local trade and services, whereas, 45%
to 52.60% of respondents across Thai border districts who reside in rural areas are mainly
involved in farming activities. In contrast, respondents who live in cities in the 2 bordering
districts of OChrov (33%) in Cambodia and Myawaddy (36.70%) in Myanmar mainly
provide labor services for cross-border trade-related activities. Moreover, fewer (15.70% to
30%) number of respondents who live in rural areas across the bordering districts are
involved in farming activities. Respondents across Thai border districts reflect good
practices of community development. Currently, the secondary roads across Thai border
districts are well developed and in excellent condition compared to those in counterpart
bordering districts. Respondents who are involved in agricultural activities across Thai
border districts are more market-oriented farmers. During the last 5 years, after the opening
of the border, respondents across the bordering districts gained greater economic and social
benefits than the counterpart respondents across Thai border districts.
Local cross-border interactions are apparently getting stronger due to closer socioeconomic ties, greater physical connectivity, and border openness. These strengthen local
cross-border complementarities, as well as enhance sustainable border livelihoods. Better
local cross-border people mobility contributes to the increasing growth of both local and
cross-border economies. Local border communities play a fundamental role in intensifying
194
195
CHAPTER 11
REGIONAL AND LOCAL BENEFITS IN DIFFERENT
CROSS-BORDER REGONS
196
During 2005-2007, it was extended to cover the area between Loei province of
Thailand and Xaignabouli province of Lao PDR and between Chantaburi province
of Thailand and Battambong province of Cambodia.
From 2008 until the present, it has further extended to cover other bordering
provinces across Thailand.
Though cross-border contract farming has long been implemented, the actual import data
are in fact inaccessible. Theres even little available data of certain years that vary from
one border province to another border province in Thailand. It should be noted that the
little available actual import data is already included in the statistics of macro bilateral
cross-border trade between Thailand and neighboring countries. Upon import, the
contracted agricultural commodities are mainly resold to either regional agro-processing
companies or feed mills. Similarly, small portions of contracted produce are further
exported. Therefore, inward distributions to either local border agro-processing industry or
traders are limited. Among the study areas in Thailand, the local border SMEs
entrepreneurs in both Sakaeo and Tak provinces obtained greater advantages due primarily
to the fact that most of investors are native border residents, whereas, local border SMEs
entrepreneurs in Mukdahan province are limited. Instead, most of SMEs entrepreneurs
originate from across the Northeastern region of Thailand. According to local border
customs officials, the actual import amount for a particular study area in Thailand is
estimated at approximately 60 to 70% of the total planned import quantity. Similarly,
among bordering provinces, small farmers in both Banteay Meanchey and Battambong
provinces of Cambodia and Kayin state of Myanmar acquire greater benefits than the
counterpart small farmers in Savannakhet province of Lao PDR. Nevertheless, the trend of
intensity of cross-border contract farming across the cross-border regions is likely to
expand. Cross-border contract farming in a particular cross-border region is described as
follows:
11.1.1 Cross-Border Region 1 (Between Sakaeo province of Thailand and Banteay
Meanchey province of Cambodia)
During the cultivation year of 2007 to 2008, there were 25 SMEs entrepreneurs with 3 fifth
of them residing in Sakaeo province. The rest of entrepreneurs came from neighboring
provinces, Bangkok metropolis, and Kanchanaburi province located in western region.
These entrepreneurs put in cross-border contract farming investment in 2 border provinces
of Cambodia, namely, Banteay Meanchey and Battambong provinces. They concentrated
their investments in 2 districts of Malai and Thama Pouk in Banteay Meanchey province
and also 2 districts of Pumpruek and Sampoulun in Battambong province. The Thai crossborder investors targeted on 7 agricultural commodities covering aggregate land area of
393,000 Rais or 155,397.39 Acres with planned imported quantity of 259,070 Tons. The
details of cross-border contract farming between Sakaeo province of Thailand and Banteay
Meanchey province of Cambodia are presented in Table 11.1.
During the cultivation year of 2008 to 2009, there were 21Thai SMEs entrepreneurs
engaged in cross-border contract farming with 12 farm factories. The planned cultivation
areas in 2 bordering provinces of Cambodia increased to 1,287,829 Rais or 51,491.6 Acres,
or a rise of 3.20 times compared with the previous cultivation year. Likewise, the planned
quantity even increased to 2,359,508 Tons, or 9.10 times higher than the previous
cultivation year. In Banteay Meanchey province alone, the cultivation encompassed a total
197
Thailand
20072008
Sakaeo
province
20082009
Sakaeo
province;
Chantaburi
province;
Bangkok;
Kanchana
buri
province
Total
Number of
Registered
Entreprene
ur
25
13
4
3
1
Cambodia
Number
of
Farmer
1.Malai and
Thama Pouk
districts
of
Banteay
Meanchey
province
2.Pumpruek
and
Sampoulun
districts
of
Battambong
province
Malai
and
Thama Pouk
districts
of
Banteay
Meanchey
province
Commodity
Planned
Area
(Rai)
1.Corn
2.Soybean
3.Green bean
4.Ground nut
5.Eucalyptus
6.Sweet corn
7.Sasame
Total
NA
NA
NA
NA
NA
NA
393,000
393,000
NA
NA
NA
NA
NA
NA
NA
259,070
*Approxi
mately
60-70 %
of total
planned
quantity
NA
1.Corn
2.Soybean
3.Green bean
4.Peanut nut
5.Castor bean
6.Eucalyptus
7.Sweet corn
8. Job's-tears
9.Sasame
Total
43,958
47,440
8,930
2,010
240
7,770
0
0
1,720
112,068
23,958
16,720
4,600
1,005
120
104,552
0
0
516
151,471
*Approxi
mately
60-70 %
of total
planned
quantity
537,660
4,600
1,633,425
2,760
280
542,540
654,608
19.6
1,636,205
1,787,676
262,351
214,925
56,100
23,000
18,095
25,000
3,000
7,000
13,375
622,846
256,585
85,056
17,125
4,000
530
150,000
4,000
500
3,390
521,186
10,020
355
50,610
35.5
0
10,375
633,221
0
50,646
571,832
Additional
commodities
10.Casava
11.Unhusked
rice
12.Cotton
Total
Grand Total
NA
1.Corn
2.Soybean
3.Green bean
4.Ground nut
5.Castor bean
6.Eucalyptus
7.Sweet corn
8. Job's-tears
9.Sasame
Total
additional
commodities
10.Casava
11.Unhusked
rice
12.Cotton
Total
Grand Total
198
Actual
import
(Tons)
NA
21
2.Pumpruek
and
Sampoulun
districts
of
Battambong
province
Quantity
(Tons)
*Approxi
mately
60-70 %
of total
planned
quantity
2013
2014
2015
Thailand
Northeastern
provinces
Northeastern
provinces
Number of
Registered
Entreprene
ur
11
Lao PDR
Commodity
Planned
Area
(Rai)
Quantity
(Tons)
Actual
import
(Tons)
NA
NA
NA
NA
Cassava chip
NA
NA
50
Northeastern
7
Savannakhet
7
provinces
province
Source: Mukdahan Provincial Commerce Office, Thailand.
Remark: NA stands for not available data.
Cassava chip
NA
NA
100
18
Savannakhet
province
Savannakhet
province
Number of
Company/
Farmer
group
10
Thailand
Number of
Registered
Entrepreneur
24
Myanmar
Kayin state
Number
of
Farmer
NA
2005/
2006
Tak
province
2006/
2007
Tak
province
28
Kayin state
NA
2015
Tak
province
16
Kayin state
NA
Planned
Area
(Rai)
1.Corn
40,000
2.Greenbean
15,000
3.Peanut
4,500
4. Castor oil
500
Total
60,000
1.Corn
41,460
2.Mung bean
23,200
3.Peanut
2,186
4.Castor oil
700
Total
67,546
1.Corn
NA
2.Green
NA
bean
Total
Commodity
Quantity
(Tons)
24,000
2,250
2,000
140
28,390
24,876
2,320
219
105
27,520
66,000
6,530
72,530
Actual import
(Tons)
*Approximately
60-70 % of total
planned quantity
*Approximately
60-70 % of
total planned
quantity
*Approximately
60-70 % of total
planned quantity
land area of 654,608 Rais or 261,843.2 Acres with the share of 50.83%. The planned
imported quantify was set at 1,787,676 Tons with the share of 75.76%. In Battambong
province, the cultivation included 633,221 Rais or 253,288.40 Acres with the share of
49.16%. The planned imported quantify was set at 571,831.50 Tons with the share of
24.23%. Unfortunately, the actual import quantity is unavailable. However, according to an
interview with a Customs official at Aranyaprathet border checkpoint, the actual import in
each mentioned cultivation year is approximated 60 to 70% of total planned quantity. It
can be articulated that a large number of rural small famers in contracted bordering
provinces of Cambodia are gaining benefits from this undertaking. This could partly help
increase household income leading towards better quality of life.
11.1.2 Cross-Border Region 2 (between Mukdahan province of Thailand and
Savannakhet province of Lao PDR)
Exceptionally, there is no border entrepreneur from Mukdahan province who engaged in
cross-border contract farming with any counterpart in Savannakhet province of Lao PDR.
Instead, a collective group of Thai entrepreneurs across the whole Northeastern provinces
199
200
203
Table 11.4 Cross-Border Region 1: Cross-Border People Mobility between Aranyaprathet Border Checkpoint in Thailand and Poipet
Border Checkpoint in Cambodia during 2002 to 2014
Year
Thailand
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Total
Passport
Cambodia
Entry
Exit
Entry
Exit
278,836
263,199
46,123
46,020
468,360
479,117
48,246
47,233
843,594
838,864
49,356
48,200
790,854
842,898
50,215
49,423
995,637
998,776
52.348
50,434
1,229,342
1,233,492
53,605
51,405
1,314,200
1,317,941
55,008
52.706
1,369,013
1,377,733
60,678
53,720
1,436,232
1,433,188
108,630
72,899
1,301,960
1,299,125
201,868
154,736
1,306,382
1,340,573
314,404
244,897
1,148,509
1,206,310
332,085
273,401
1,223,590
1,315,974
362,274
298,255
13,706,509
13,947,190
1,682,544
1,390,676
Source: Aranyaprathet Immigration Office, Thailand.
204
204
Total
CrossBorder
Movement
(Person)
4,899,271
5,776,456
7,078,753
7,539,627
8,839,962
8,943,543
9,977,845
10,668,761
13,411,089
13,194,381
13,760,703
12,014,823
13,077,745
129,182,959
Average All
Nationalities
Movements
/Day
13,296
15,694
19,259
20,657
24,219
24,503
27,337
29,229
36,743
36,149
37,701
32,917
35,829
27,195
Table 11.5 Cross-Border Region 2: Cross-Border People Mobility between Mukdahan Border Checkpoint in Thailand and
Savannakhet Border Checkpoint in Lao PDR during 2002-2014
Year
Thailand
Entry
Exit
205
2002
5,202
5,550
14,614
2003
5,822
5,668
17,750
2004
10,423
12,394
18,726
2005
31,392
27,338
30,034
2006
58,836
55,071
49,325
2007
117,037
122,329
72,521
2008
141,226
138,007
113,125
2009
212,190
216,522
117,476
2010
199,468
200,884
155,184
2011
255,787
251,805
179,083
2012
252,159
254,811
204,450
2013
183,733
185,625
232,819
2014
209,016
208,556
245,357
Total
1,682,291
1,684,560
1,450,464
Source: Mukdahan Immigration Office, Thailand.
10,353
14,750
15,569
32,237
41,608
63,971
96,312
114,791
120,136
144,216
160,600
190,138
194,263
1,198,944
30,478
37,657
38,234
40,662
41,278
42,626
43,248
45,364
40,942
45,112
46,929
51,785
53,906
558,221
31,679
38,624
39,678
39,497
40,961
41,375
42,356
42,261
41,251
41,023
46,669
51,872
51,703
548,949
205
72,185
106,102
152,004
184,206
225,478
262,378
312,891
346,181
390,281
588,819
567,930
252,135
231,442
3,692,032
72,645
106,647
152,246
186,321
226,246
261,246
301,246
342,957
388,777
570,901
611,435
270,611
244,343
3,735,621
12,674
15,697
21,132
30,132
42,102
56,007
73,479
96,921
104,171
114,509
42,142
52,621
156,398
817,985
13,748
16,742
21,762
30,768
42,748
56,762
74,763
93,763
112,846
109,720
56,014
78,995
178,116
886,747
Total
CrossBorder
Movement
(Person)
269,128
365,459
482,168
632,587
823,653
1,096,252
1,336,653
1,628,426
1,753,940
2,300,975
2,243,139
1,550,334
1,773,100
16,255,814
Average All
Nationalities
Movements
/Day
737
1,001
1,321
1,733
2,257
3,003
3,662
4,467
4,811
6,310
6,152
4,253
4,863
3,428
Table 11.6 Cross-Border Region 3: Cross-Border People Mobility between Maesod Border Checkpoint in Thailand and
Myawaddy Border Checkpoint in Myanmar during 2002-2014
Year
206
206
Total CrossBorder
Movement
(Person)
561,225
639,829
722,342
780,393
823,977
866,551
916,923
966,342
982,886
207,229
1,186,923
1,677,611
2,416,359
12,748,590
Average All
Nationalities
Movements
/Day
1,538
1,753
1,979
2,138
2,257
2,374
2,512
2,648
2,693
568
3,252
4,596
6,620
2,687
207
The accumulative movements were divided into: (1) vans at 0.65 million vehicles mainly
for carrying passengers, with annual average growth of 55.69%; (2) passenger cars at 0.13
million vehicles with annual average growth of 32.87%; and (3) trucks at 0.02 million
vehicles, mainly for cross-border logistics supporting cross-border trade activities with
annual average growth of 22.56%. In contrast, Thai vehicle movements had much lower
share of 0.38 million vehicles, which accounted for 19.36% of accumulative cross-border
vehicle movements.
The accumulative movements were divided into: (1) trucks at 0.29 million vehicles mainly
for cross-border logistics supporting cross-border trade activities, with annual average
growth as high as 39.12%; (2) passenger cars at 0.08 million vehicles with annual average
growth of 46.51%; and (3) vans at 0.009 million vehicles mainly for carrying passengers,
with annual average growth of 26.14%. The somewhat low intensity of cross-border
movements of vehicles of Thai nationals might have resulted from Myanmars unilateral
restriction on passage of vehicles. This restriction was due to non-implementation of the
signed Initial Implementation of Cross-Border Transport Agreement (IICBTA) between
Thailand and Myanmar. The details of cross-border vehicle mobility between Maesod
district of Tak province in Thailand and Myawaddy district in Kayin state of Myanmar are
shown in Table 11.9.
209
Table 11.7 Cross-Border Region 1: Cross-Border Vehicle Mobility through Aranyaprathet Border Checkpoint in Thailand during
2009-2014
Year
Type of Vehicle
Passenger Car
Truck
Thailand
Cambodia
Thailand
Cambodia
Entry
Exit
Entry
Exit
Entry
Exit
Entry
Exit
2009
2,010
2,010
5,140
5,140
39,047
39,224
0
0
2010
1,200
1,200
3,536
3,536
43,362
43,751
0
0
2011
1,005
1,005
2,860
2,860
49,855
50,479
0
0
2012
4,567
4,567
33,537
33,537
57,691
57,994
0
0
2013
1,015
1,015
2,895
2,895
53,712
54,415
0
0
2014
1,102
1,102
5,374
5,374
66,047
66,885
0
0
Total
10,899
10,899 53,342
53,342
309,714
312,748
0
0
Source: Aranyaprathet Immigration Office, Thailand.
Cambodia
Entry
Exit
5,140
5,140
3,536
3,536
2,860
2,860
33,537
33,537
2,895
2,895
5,374
5,374
53,342
53,342
Total
Vehicle
Movement
92,571
96,585
108,064
191,893
115,947
145,884
750,944
Average
Vehicle
Movements/
Day
254
265
296
526
318
400
343
210
Table 11.8 Cross-Border Region 2: Cross-Border Vehicle Mobility through Mukdahan Border Checkpoint in Thailand during
2009-2014
Year
2009
2010
2011
2012
2013
2014
Total
Passenger Car
Thailand
Entry
Exit
34,922
36,303
39,202
42,910
42,726
44,621
44,304
44,935
42,368
44,090
46,872
48,734
250,394
261,593
Lao PDR
Entry
Exit
36,895
37,509
49,175
50,670
69,162
69,223
83,817
84,882
97,983
99,649
128,849
124,522
465,881
466,455
Truck
Thailand
Entry
Exit
21,836
23,015
22,627
22,703
27,482
28,058
33,314
34,189
33,410
34,207
35,802
35,910
174,471
178,082
210
Lao PDR
Entry
Exit
1,778
1,441
2,903
1,796
2,910
2,265
3,398
2,987
3,487
2,808
3,554
3,240
18,030
14,537
Total Vehicle
Movement by Land by
Country
TH
Lao
121,488
82,375
136,034
113,137
152,028
152,289
165,646
183,987
162,811
212,663
176,016
268,863
914,023
1,013,314
Lao PDR
Entry
Exit
1,644
1,644
1,480
1,480
1,374
1,374
1,383
1,383
1,336
1,336
1,357
1,357
8,574
8,574
Average
Vehicle
Movements
by
Land/Day
559
683
834
958
1,029
1,219
880
Table 11.9 Cross-Border Region 3: Cross-Border Vehicle Mobility through Maesod Border Checkpoint in Thailand during 2009-1014
Year
2009
2010
2011
2012
2013
2014
Total
Type of Vehicle
Passenger Car
Van
Truck
Thailand
Myanmar
Thailand
Myanmar
Thailand
Myanmar
Entry
Exit
Entry
Exit
Entry
Exit
Entry
Exit
Entry
Exit
Entry
Exit
8,500
8,500
6,800
6,800
1,000
1,000
14,508
14,508
13,688
13,689
1,000
1,000
4,300
4,300
5,000
5,000
400
400
21,100
21,100
13,561
13,562
1,500
1,500
0
0
0
0
0
0
0
0
0
0
0
0
3,350
3,350
10,000
10,000
450
450
56,271
56,271
15,407
15,407
2,000
2,000
11,001
11,001
17,500
17,500
1,200
1,200
89,552
89,552
45,273
45,273
2,900
2,900
13,500
13,500
26,000
26,000
1,800
1,800
145,907 145,908
58,044
58,044
3,100
3,100
40,651
40,651
65,300
65,300
4,850
4,850
327,338 327,339 145,973 145,975
10,500
10,500
Source: Maesod Immigration Office, Thailand.
Note: Myanmar unilaterally closed Myawaddy border checkpoint throughout the year 2011.
211
211
Myanmar
Entry
Exit
22,508
22,508
28,000
28,000
0
0
68,271
68,271
109,952 109,952
170,007 170,008
398,738 398,739
Total
Vehicle
Move
ment
91,393
92,523
0
174,956
334,852
486,703
1,180,42
Average
Vehicle
Movement
/Day
250
253
0
479
917
1,333
497
2009-2014, there was a rapid intensity of local and regional cross-border vehicle mobility
in the studied cross-border regions as well. The cumulative local and regional cross-border
movements of all types of automobile, excluding the International Mekong river boat in a
cross-border region of Muang Mukdahan district of Thailand and Kaysone Phomvihane
district of Lao PDR, were as high as 3.66 million vehicles with varying intensities of
movements at 0.75 million vehicles; 1.18 million vehicles; and 1.92 million vehicles in the
cross-border region 1; cross-border region 3; and cross-border region 2, respectively. The
common underlying factors contributing to this growth are similar to the above crossborder people mobility. Hence, the trend of cross-border vehicle mobility across the
studied cross-border regions is likely to intensify.
The findings are coherent with the study of Healey (2004) that the metaphor of flow can be
inserted into traditional essentialist geography of gravity-based traffic models. She
assumes that peoples movement in space is governed predominantly by proximity
principles. Additionally, it is evident that regional integration and agreements between
Thailand and bordering countries of Cambodia, Lao PDR, and Myanmar particularly the
ACMECS and Greater Mekong Sub-region development program in particular and the
ASEAN Community in general have been stimulating the countries towards closer
interdependence among them. The integration and agreements, coupled with greater
physical connectivity in the form of economic corridors, cross-border investment and
people movement facilitations, have rapidly increased the local and regional cross-border
flows of goods, people and vehicle mobility. Therefore, the border cities are important
gateways to capture these flows. The growth is somewhat similar to the European Union
integration process although it is moving in a slower pace. With the preceding key findings
and reflections, the hypothesis stating that cross-border trade regions are expected to gain
infrastructural, economic and service benefits at the regional scale due to production and
trading linkages is jointly supported.
213
CHAPTER 12
SUMMARY, CONCLUDION AND RECOMMENDATIONS
This chapter provides the summary, conclusion and recommendations on strategies for
integrated development of cross-border economic zones at both national and cross-border
region levels employing the relevant analysis and salient findings from the preceding
chapters.
12.1 Summary
The summaries of key findings from the preceding chapters are as follows:
12.1.1 Policy Analysis Favorable for Development of Special Border Economic Zones
in Thailand
Thailand adopts 5-year national development plan to guide development paths. Over 54
years of national development planning, spatial development policies are continually
evolving in line with national and sectoral development progress, which can be classified
into 4 distinct periods. Each period is characterized by specific spatial development
advancement. Currently, Thailand is under the fourth period (2002-2015) which is shifting
towards upholding rural-urban relations and development of special border economic
zones (SBEZs) along the Greater Mekong Economic Corridors in order to grasp the
potential of proliferating the regional cooperation and integration programs particularly for
the Ayeyawady-Chao Phraya-Mekong Economic Cooperation Strategy (ACMECS), the
Greater Mekong Sub-region Economic Cooperation Program and the ASEAN Economic
Community to become integral part of the ASEAN Community.
The development of SBEZs in Thailand is intermittent due to political discontinuity. The
Thaksin Administration initially announced to promote the first SBEZs in both Chiang Rai
and Tak provinces since 2003. However, it encountered severe resistance from both local
authorities and general public who were aware of being profoundly displaced from their
local administration function by new local authorities under the proposed special border
economic zone law. This subsequently generated wide criticism on the pros and cons of the
SBEZ within the Thai society.As a result, the initiative to implement these two pilot
SBEZs was consequently sluggish for almost 8 years. As Thailand approached full entry
into the ASEAN Community by the end of 2015, the Abhisit Administration reapproved on
October 19, 2010 to develop Maesod district in Tak province as a pilot special border
economic zone. On March 22, 2011, a total budget of 14.04 million Baht was then
allocated to carry out a research for the formulation of development plan of Maesod
Special Border Economic Zone. In 2013, the Yingluck Administration renewed support for
the scheme by setting up a mechanism so called the Special Border Economic Zone
Development Policy Board. Subsequently, a strategic plan for promoting special border
economic zones was formulated in 2014 covering 5 regions across the country. The 5
regions are: 1) Northern border region comprising Maesai, Chaingsaen and Chaingkhong
districts in Chiang Rai province and Tak province; 2) Northeastern border region
consisting of Mukdahan, Nakhon Phanom and Nongkhai provinces; 3) Eastern border
region representing Sakaeo and Trad provinces; 4) Western border region comprising
Kanchanaburi province; and 5) Southern border region including Sadao district of Song
Khla province and Narathiwat province.
214
regional development as both urban and rural people including the poor along border
regions between Thailand and neighboring countries can also benefit from trade, as well as
access the variety of products. This will result in better quality of life. However, crossborder traded goods are mainly produced in Bangkok and its vicinity like the eastern
region and regional growth centers. At present, the Thai border cities and towns play
distribution role. In addition, there is an existing informal or illegal cross-border trade
carried out by both local people and outsiders. There is no available data on the volume of
informal cross-border trade. However, its trend seems likely to decline because of tariff
reductions and continuing efforts to formalize cross-border trading.
Likewise, consolidated cross-border transit trade to Singapore, Vietnam and China is on
expanding trend. The patterns of cross-border trade between Thailand and neighboring
countries considerably varied from country to country, resulting from different stages of
development and diverse political and economic systems. Therefore, a number of common
and different bilateral cross-border trade problems still exist. The factors contributing to
the expanding cross-border trade included cross-border and regional infrastructure
linkages, bilateral and regional trade agreements, and regional trade facilitation initiatives.
12.1.3 Comparative Micro Level Analysis of Local Cross-Border Trade Flows of
Goods and Services
Cross-border trading is mostly undertaken by local border residents across the cross-border
regions. Most of the cross-border trader respondents across the regions are family based
businesses and mainly under the category of small and medium-sized enterprises (SMEs).
The duration of operation of the establishments across the regions is 11 to 13 years. Thai
goods are widely accepted among bordering countries. The cross-border exported
commodities across the Thai border districts are quite similar in pattern, mainly consisting
of consumer goods, intermediate and capital goods. On the other hand, the cross-border
imported commodities from bordering districts are mostly agricultural produces. There are
strong supply chain linkages between Thai border districts with Bangkok metropolis and
its vicinity and vice versa. At present, Thai border cities and towns mainly play distribution
role. Cross-border traders play important role in promoting cross-border supply chain
linkages. Thai goods hold a large market share at a varying range of 38% to 77% of total
traded commodities across the cross-border regions. Collectively, ASEAN goods hold high
market share in the range of 78.30% to 100% across the regions. Payment by cash is
widely adopted across the cross-border regions as matter of convenience. Cross-border
trader respondents across the bordering districts engaged a higher number of local labor
with 12 to 41 workers mainly for loading and unloading activities. In contrast, respondents
across Thai border districts employed a lower number of local and immigrant labor with a
range of 7 to 10 workers. Only respondents across the Thai border districts employed
immigrant labor at the range of 5 to 9 workers. The daily wage rates across the Thai border
districts are approximately 3 times higher than the counterpart study location of bordering
districts. Respondents across Thai border districts of Maesod (5.60%), Muang Mukdahan
(16.60%), and Aranyaprathet (22.70%) have performed cross-border transit trade with
Vietnam. Improvement of cross-border connectivity (e.g., roads and international river
bridges) facilitated cross-border trade. The respondents perceived that border banking and
Customs, Immigration and Quarantine (CIQ) services across the border districts of
Thailand are noticeably well-organized than the counterpart bordering districts.
216
217
Phomvihane district of Lao PDR and OChrov district of Cambodia. Three fifth of Thai
shopper respondents in Maesod district do shopping a wide range of Burmese products at
Rim Moei border market, which is located in Maesod district of Thailand. On the other
hand, 40% to 93.30% of cross-border shopper respondents across the bordering districts
mainly buy at leading modern border retail stores across Thai border districts (e.g., Tesco
Lotus and Big C, etc.).Thai shopper respondents in Muang Mukdahan (32.10 %) and
Aranyaprathet (56.60 %) districts purchase luxury goods (e.g., liquor and wine, which are
made in western countries) in counterpart bordering districts. Quite the reverse, more than
2 third of Thai shopper respondents in Maesod district buy fresh and dry sea aquatic
products in bordering Myawaddy district of Myanmar. In contrast, 50% to 59.40% of
cross-border shopper respondents across the bordering districts procure consumers goods.
Respondents across the bordering districts spend higher average amount per shopping.
Respondents across the bordering districts perform more frequent cross-border shopping
than those respondents across Thai border districts. Ranging from 40 % to 90 % of
respondents across the cross-border regions do cross-border shopping for their own
consumption.
12.1.5 Local and Regional Cross-Border Production Linkages
The number of border industrial developer respondents across Thai border districts who
have formal business registrations are more than counterpart respondents in the bordering
districts. Interestingly, respondents across the bordering districts gain greater investment
incentives from respective bordering governments than counterpart respondents across
Thai border districts. More respondents in Thai border districts have exogenous industries.
In contrast, more respondents in 2 bordering districts have endogenous industries.
Moreover, OChrov district of Cambodia hosts the highest (83.30%) number of
respondents having exogenous industries. Most of the respondents across Thai border
districts relocate to open new factories or services. Thai border districts have
establishments operating for more than 7 years. Bordering districts of other countries have
establishments operating recently, within the last 4 years. Investment capital significantly
varies across the cross-border regions. Respondents in Thai border districts are mostly
small and medium sized enterprises (SMEs) with average capital investment of about 40
million Baht, which is much higher as compared to other districts of bordering regions
Myawaddy district of Myanmar and Kaysone Phomvihane district of Lao PDR. On the
contrary, remarkably 96.70% of respondents in OChrov district of Cambodia own
informal micro-enterprises with investment capital of just about 0.50 million Baht. The
manufactured products or service goods significantly vary across the cross-border regions.
Generally, the Thai border districts are more industrialized than the 2 bordering districts,
except in Kaysone Phomvihane district of Lao PDR, which is more industrialized than the
counterpart bordering Muang Mukdahan district of Thailand. Remarkably, major
productions are concentrated on items related to fashion industries in both Maesod district
of Thailand (specializing in high-end products) and OChrov district of Cambodia
(specializing in low-end products). Outstandingly, four fifth of respondents in Maesod
district of Thailand are manufacturers of fashion goods, of which two third of respondents
produce high-end wearable apparels and garments. About 10 percent of respondents make
textile products. As a result, Maesod district has become an important fashion cluster of
Thailand and has been connected with global community chains. Sources of labor
noticeably vary across the cross-border regions depending on national and international
division of labor. More respondents across Thai border districts employ semi-skilled
immigrant labor. On the contrary, respondents across bordering districts mainly engage
internal migrant labor. The cross-border movement patterns of immigrant labor
218
counterpart respondents across the bordering districts. Main sources of border household
incomes considerably vary across the cross-border regions. There are complementary
linkages of sources of household income between Thai border districts and the bordering
districts, particularly on labor and cross-border outsourcing activities. Respondents who
live in the cities across Thai border districts and in Kaysone Phomvihane district of Lao
PDR mostly engage in local trade and services, whereas, 45 % to 52.60 % of respondents
who reside in rural areas across Thai border districts, mainly involve in farming activities.
Moreover, respondents who live in cities in the 2 bordering districts of OChrov (33%) in
Cambodia and Myawaddy (36.70 %) in Myanmar mainly provide labor services for crossborder trade-related activities. On the contrary, 15.70 % to 30 % of respondents who live in
rural areas across the bordering districts involve in farming activities. Respondents across
Thai border districts reflect good practices of community development. The secondary
roads across Thai border districts are well developed and currently in better conditions than
the counterpart bordering districts. More respondents who are involved in agricultural
activities across Thai border districts are market-oriented farmers. After the opening of the
border during the last 5 years, respondents across the bordering districts gained greater
economic and social benefits than the counterpart respondents across Thai border districts.
12.1.7 Regional and Local Benefits at Different Cross-Border Regions
1) Overview of Cross-Border Investment in the Form of Contract Farming
Since 2004, the Royal Thai Government has continuously encouraged Thai entrepreneurs
or traders to engage with counterpart farmers or entrepreneurs in neighboring countries of
CLM in growing agricultural commodities under contract farming. The targeted
agricultural commodities consisted of 10 farm plants and 3 energy crops. Among the
respondents in the study areas in Thailand, the local border SMEs entrepreneurs/investors
in both Sakaeo and Tak provinces get more advantages as they are native border residents,
whereas, the local border SMEs entrepreneurs in Mukdahan province receive limited
benefits. Most of the SMEs entrepreneurs originate from across the Northeastern region of
Thailand. Similarly, among bordering provinces, small famers in both Banteay Meanchey
and Battambong provinces of Cambodia and Kayin state of Myanmar acquire greater
benefits than counterpart small farmers in Savannakhet province of Lao PDR.
Nevertheless, the trend of cross-border contract farming intensity across the studied crossborder regions is likely to expand.
2) Cross-Border People Mobility
Border checkpoints physically play crucial role as gateways for facilitating peoples
mobility, which has driven cross-border tourism activities, as well as strengthened people
to people contacts. During 2002-2014, there was a rapid increase of local and regional
cross-border people mobility across the studied cross-border regions. The cumulative local
and regional cross-border movements across the study cross-border regions were as high as
158.18 million people with varying intensities of movements at 129.18 million people,
16.25 million people, and 12.74 million people through cross-border region 1, cross-border
region 2, and cross-border region 3, respectively. These growths are substantiated by a
number of common underlying factors comprising of: better improvement of land
transportation linkages; bilateral labor cooperation; regional tourism cooperation schemes;
and presence of large border casinos in bordering countries. The factors also included
specific cross-border movement agreements between Thailand and neighboring countries
and an Initial Implementation of Cross-Border Transportation Agreement (IICBTA) in the
Greater Mekong Sub-region (GMS), which connects border checkpoints between
220
Aranyaprathet district in Sakaeo province of Thailand with Poipet city in OChrov district
in Banteay Meanchey province of Cambodia (effective in 2012); between Mukdahan
province of Thailand and Savannakhet province of Lao PDR (effective in 2009) and
between Maesod district in Tak province of Thailand and Myawaddy district in Kayin state
of Myanmar, which was signed in 2009 but not yet implemented due to bilateral political
reason. In addition, there are other specific factors which play a part of this growth of
people mobility between Thailand and neighboring countries. These factors include
regional tourism road transport agreements between Lao PDR, Thailand and Vietnam, as
well as the effect of an agreement between Thailand and Cambodia under pilot ACMECS
Single Visa effective since December 16, 2010 (Ministry of Transport of Thailand, 2011).
As a result, the trend of cross-border people movement intensity in the study cross-border
regions is likely to proliferate.
3) Cross-Border Vehicle Mobility
Border checkpoints also physically play vital role as gateways for facilitating vehicles
mobility, which has driven cross-border economic, social and tourism activities. During
2009-2014, there was a rapid intensity of local and regional cross-border vehicle mobility
in the studied cross-border regions as well. The cumulative local and regional cross-border
movements of all types of automobile, excluding International Mekong river boat in a
cross-border region of Muang Mukdahan district of Thailand and Kaysone Phomvihane
district of Lao PDR, were as high as 3.66 million vehicles with varying intensities of
movements at 0.75 million vehicles, 1.18 million vehicles, and 1.92 million vehicles in the
cross-border region 1, cross-border region 3, and cross-border region 2, respectively. The
common underlying factors contributing to this growth are similar to those factors that
increased cross-border people mobility. Hence, the trend of cross-border vehicle mobility
across the study cross-border regions is likely to intensify.
Based on summary of findings and reflections discussed in previous Chapters, a synthesis
has been made using SWOT Analyses for three cross-border regions and presented in
Table 12.1, 12.2 and 12.3.This has been used for deriving appropriate recommendations.
221
Opportunities
Threats
222
Table 12.2 SWOT Analysis of Muang Mukdahan district of Mukdahan province in Thailand
Strengths
Weaknesses
Opportunities
Threats
223
Weaknesses
Cross-border traded goods are mainly
produced in Bangkok metropolis and its
vicinity and the eastern region of Thailand.
Border city of Maesod currently plays major
role as distribution center.
Traffic congestion at Maesod border
checkpoint affects trade flows.
Thai Baht is a widely accepted currency in bordering cities.
Weak local backward linkages and cross Rim Moei Integrated Border Market play important role in boosting cross-border
economy. Both local Thais and Myanmar nationals are freely able to do businesses in this border production linkages.
Employed migrant Burmese labor adopts
market.
step migration by working in Maesod district
There is an existing long established SMEs entrepreneurship represented by half of
for a while, then, mostly fleeing to Bangkok
cross-border traders and border wholesalers who are local border residents. Regarding
metropolis and vicinity due to wage
retailing, 60% of traders are formal retailers and large retail chain establishments are
differences. It consequently causes serious
increasing. Border banking services are conveniently available.
disruption to local border industries.
Mode of payment for cross-border trade is mostly by cash.
Border household income clearly varies
Also, 40% of border industrial developers are long established endogenous industries and with distances from city center, which means,
most of industrial developers are MSMEs and family businesses. The key industries are
the farther from the city center, the lesser
wearable apparels, garments and textile leading Maesod district to become an important
income generated.
national production base for fashion industry, as well as fostering strong linkages with
Slightly more than half of border
global commodity chains.71% of border industries are either locally or domestically
Households rely on farming activities.
outsourced productions in the form of Original Equipment Manufacturer (OEM) mainly
Approximately 20% of border households
from Bangkok metropolis and its vicinity. And 23% of border industries produced for their
in Maesod district gain nothing (in terms of
own brands.
economic or social benefits) after the opening
Border industries, trade and household sectors widely employed cheap migrant Burmese
of the border during the last 5 years. These
labor.
sort of households can be considered as the
55 % of border households are native local residents and with low border poverty
excluded group.
incidence.
Border households in Maesod district have almost 3 times higher average monthly
income than counterparts in bordering Myawaddy district of Myanmar.
Most of border households in Maesod district have land ownerships.
There is a well-developed community road network.
Opportunities
Threats
Contributing factors to expansion of cross-border trade include cross-border and regional Threats in Kayin state of Myanmar are as
follows:
infrastructure linkages, bilateral and regional trade agreements, bilateral and regional
Internal political uncertainty in Kayin state
investment agreements and regional trade facilitation initiatives.
affects cross-border trade environment.
Initial implementation of Cross-Border Transport Agreement at Maesod border
Unilateral closure of Myawaddy border
checkpoint and Myawaddy border checkpoint (Myanmar) increases greater intensity of
checkpoint since July 2010 until December
cross-border people and vehicle mobility.
2011 led to a loss of 80% of trade value per
Access to abundant cheap immigrant labor from bordering Kayin state of Myanmar,
month.
this can help solve labor shortages in bordering Maesod district of Thailand.
Frequent changes on applied customs
Promoting Maesod district as a strategic national fashion industry cluster.
tariffs and customs formalities at Myawaddy
Potential market expansion of Thai products to bordering Myanmar market.
border checkpoint do not comply with
Existence of Royal Thai Government integrated policies including
international standard.
investment incentives to establish special border economic zones in Maesod and
Lack of local and regional road
surrounding districts as pilot special border economic zones could foster stronger crossInfrastructure in Myanmar.
border production linkages and outsourcing of productions with bordering Myawaddy
Long importation process (2 days)
district of Myanmar.
Lack of decentralization of power to local
Border industries could be expanded, particularly for agro-processing
officials to issue ASEAN Integration System
industries using agricultural input for production from bordering Kayin state.
of Preferences (AISP) certificate.
Promising prospect for cross-border investment in the form of contract
Several channels for imported goods are
farming from Tak province to bordering Kayin state of Myanmar.
risky as they are located in minority group
Being a strategic gateway for conducting cross-border transit trade to both India and
strongholds, which are not authorized by
Bangladesh.
Burmese government.
Internal ceasefire agreement could sustain political stability in Myanmar.
Immigrant Burmese labor could carry
communicable diseases.
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12.2 Conclusion
With the advent of ASEAN integration, cross-border regions have emerged as new growth
centers. Thailand, which is located in the mainland of greater Mekong sub-region,
possesses promising geo-economic and connectivity with bordering countries especially
through the realization of the Greater Mekong Sub-region Corridors, particularly the EastWest and Southern economic corridors. In order to grasp this potential, Thailand has
recently materialized to transform existing interdependent borderlands towards integrated
development of special border economic zones across the country. It has also planned to
foster supply chain and production linkages with counterpart border economic zones in less
developed neighboring countries. As a result, the overall national border economic zone
development policies and strategies in Thailand have been proposed. Also, a number of
development strategies for specific cross-border economic zones in Thailand consisting of
Aranyaprathet district of Sakaeo province, Muang Mukdahan district of Mukdahan
province, and Maesod district of Tak province have subsequently been recommended in
order to promote integrated borderlands development and cross-border regional
development with respective bordering districts of OChrov in Cambodia, Kaysone
Phomvihane in Lao PDR and Myawaddy in Myanmar.
The preceding chapters have already supported the three specific hypotheses of this
research. The findings of this research have both common and different features in
comparison with other empirical studies. Similar to the other empirical studies, the findings
of this research uphold the following specific hypothesis:
Hypothesis 1: National and regional level policies and strategies are vital for border
economic zones in order to boost and catalyze respective national and regional
development.
This research coincided with the work of Houtum (2000) who identified trends within
geographical studies of the European Union Integration process. Houturns work
comprises three approaches, namely, flows and barriers, cross-border cooperation, and
people much similar in outlook with the development of border economic zones in
Thailand linking with border countries. This research also resembles well with the work of
Brunet Jailley (2005) who conceptualized the theory of borderlands studies. The work is
especially relevant to policy activities of multiple levels of governments in adjacent
borders. Likewise, such kind of policies on promotion of special border economic zones
and linkages with counterpart bordering countries are gradually evolving in Thailand.
Hypothesis 2: Locational advantage of border towns/cities with regional transport
networks is essential for fostering socio-economic and local area development.
This study also found that the cross-border regions are fast urbanizing. It corresponded
with the findings of Scott (2002) stating that border urban growth patterns reveal annual
growth rates averaging around 2.2 % for US border cities and 3.5 to 6 % for Mexican
border cities in the period between 1980 and 1990. The study discovered that the Thai
cross-border regions are fastly emerging towards new growth centers along the GMS
economic corridors. Likewise, Blatter (2004) stated that European developers describe
their cross-border regions as a place in the center of Europe and North Americans talk
about port of entry, corridors and gateways. Staudt et.al (2010) also found that a sprawling
transnational urban space along the U.S.-Mexico border has mushroomed into a
225
drugs, bottled beverages, furniture, foods, arts and crafts, medical and dental services, car
repairs and entertainment. On the other hand, Mexican consumers travel north for
manufacturing goods such as clothing, electronic products, refrigerators, washing
machines, automobiles and auto parts, etc.
In relation to different features, most of the large-scale cross-border merchants across the
cross-border regions are formal traders under the category of SMEs. Male cross-border
traders are represented by 54.40% to 76.70% of respondents across the cross-border
regions. Thailand exports consumer, intermediate and capital goods to bordering countries
(Cambodia, Lao PDR, Malaysia and Myanmar) and imports agricultural commodities,
natural gas and capital goods from these bordering countries. In contrast, Afrika and
Ajumbo (2012) found that due to different stages of development, the small-scale informal
cross-border trade is a source of income to about 43% of Africas population and majority
of informal cross-border traders are women. According to the United Nations Development
Fund for Women (UNDFW), in the Southern African Development Community region,
women comprise about 70 percent of the informal cross-border traders. In the Western and
Central parts of Africa, women consist nearly 60 percent of informal traders. Traded goods
are not only agricultural commodities but also include small electronics, household
appliances, clothes, shoes and cosmetics, among others. Therefore, informal cross-border
trade can help alleviate poverty and enhance regional food security. The study found that
there is non-existent of cross-border institution across the studied cross-border regions.
Whereas, Blatter (2004) found that there are a variety of cross-border institutions in
European and North American border regions.
Three cross-border regions have grown disproportionately and it is more concentrated and
developed in Thailand territory as compared to others. This is due to locational advantages
and coupled with well-developed transport networks in Thailand and limitedly in the
counterparts. The regions have been gradually progressive taking advantage of existing
policy instruments of Thailand (both explicit and implicit policies). Due to infrastructural
development, industrial productions in fashion goods and trading linkages, the regions are
quite vibrant and offered employment and income opportunities to migrant labors from
bordering countries and more specifically to local people in the immediate districts. This
study has confirmed with the findings of other scholars in the context of cross-border
regions between Thailand and bordering countries. In addition to this, this has also
provided several implications not so much addressed by other scholars under similar
situation. Cross-border trade regions contributed for regional as well as local development.
In terms of theoretical knowledge, the findings together fits more or less with the theories
of comparative advantage by Richardo (1817), resource and trade theory by Ohlin (1933),
gravity model by Tinbergen (1962), home market effect by Krugman (1980), world system
theory by Wallerstein (1974), level of economic integration by Carbaugh (2009), model on
specific factors and income distribution by Krugman, Obstfeld and Melitz (2010), standard
model of trade by Obstfeld and Melitz (2010), spatial division of labor by Massey (1984),
cross-border regions by Perkmann and Sum (2002), paradigms of cross-border interactions by
Martinez (1994), types of cross-border cooperation based on different geographical scales of
cross-border linkages between regional economies by Krtke (2002), concept of border
economics by Fullerton (2003), central premises that determine the inter-urban hierarchy of
border space by Alegria (1989), dynamic and static comparative advantages of regions by
Krugman and Livas (1992), locational advantages by Hanson (1996), theory of borderland
studies by Brunet Jailley (2005), the determinants of open and closed borders by Boehmer and
227
12.3 Recommendations
There are several implications for planning of special border economic zones, including
policies and strategies in the context of national and regional development, for the
promotion of economic and sociocultural boundaries. Currently, the planning of special
border economic zones is mainly carried out by central governments. Therefore, it is
crucial to promote greater multilevel governance to link local, provincial, regional and
central government. SWOT analysis for the 3 locations have been attempted, with results
presented in Table 12.1, Table 12.2, and Table 12.3. Based on the results, a set of
recommendations have been made as outlined in the following sections.
12.3.1 National Development
The recommended policies and strategies for integrating development of border economic
zones into national development in Thailand are as follows:
1) Policies
Adopt the border economic zone concept as strategy for both promoting regional
economic development within Thailand, as well as fostering regional production networks
of Thailand with bordering cities along economic corridors in order to fully integrate with
the ASEAN Community and global economy.
Integrate the implementation of border economic zones with national security
policies and programs in order to advance towards integrated borderlands development
between Thailand and bordering countries.
Relocate less competitive industries which require labor-intensive production to
particular border economic zones, so that it can gain advantages of cross-border
cooperation, international and spatial division of labor between Thailand and bordering
countries.
Promote the use of Thai Baht as key currency for cross-border trade transactions
between Thailand and bordering countries. Furthermore, internationalize the Thai Baht
currency across the Greater Mekong Sub-region to help facilitate cross-border payment.
Set up an international institutional mechanism for administering integrated crossborder economic zones based on the concept of Two Countries-One Region. It should
then define clear physical boundary of the integrated cross-border economic zones between
Thailand and bordering countries. Within this region, cross-border movements of goods,
capital, people and vehicle could freely flow.
An array of aid for trade programs through the Ministry of Foreign Affairs should
also be extended to bordering countries consisting of Cambodia, Lao PDR and Myanmar,
in order to address common border development and management issues.
2) Strategies
Provide quality cross-border infrastructure linkages, as well as promote crossborder trade facilitation, investment and people movement. Also, negotiate and facilitate
cross-border transit trade with nearby countries (e.g., Vietnam, China, India and
Bangladesh, etc.).
Control and overcome the portion of illegal cross-border trades in order to bring
228
tradeable goods under the formal cross-border trade undertaking. This can suppress largescale import of low quality agricultural produce into Thailand and recover the loss of
revenue for both Thailand and bordering countries.
An inter-ministry coordination and integration mechanism is very much desired to
bring the responsible agencies and stakeholders associated with cross-border trade
promotion and facilitation and border industrial development. The key ministries are
Ministry of Commerce, Ministry of Industry, Ministry of Finance, Thailand Immigration
Bureau, Ministry of Agriculture, Ministry of Natural Resources and Environment, etc.
It is important to promote local direct investments in order to provide cross-border
logistics services competitive with multinational logistics providers. In addition, collective
efforts for nurturing entrepreneurship of all types of traders should be initiated by the
Ministry of Commerce and the Thai Chamber of Commerce.
Widely publicize the implementation of BEZs and grant investment privileges to
potential investors locally and internationally.
National institutional capacity building for BEZs should be promoted. As border
economic zone concept is newly adopted in Thailand, a wide range of capacity building
schemes should be provided by the Office of National Economic and Social Development
Board (NESDB) and other relevant agencies in order to efficiently deal with multifaceted
issues on SBEZ development.
Cross-border region institutions should be fostered in order to coordinate local
cross-border interactions.
3) Regulatory Measures
Create a new set of regulations favorable for cross-border trades and provide
independence from the existing broad regulations on international trade. This is because
cross-border trade between Thailand and neighboring countries is somewhat a different
track. Therefore, it is necessary to design such regulations in response to the changing
cross-border trade environment in the context of ASEAN Community and other regional
cooperation programs (e.g., ASEAN and China and ASEAN and India, etc.).
Allow daily cross-border movement of migrant labor from bordering countries to
work in the SBEZs.
12.3.2 Regional and Local Development
The SWOT Analysis method is employed to identify both internal and external factors
contributing towards development of cross-border economic zones. The internal factors
consisted of strengths and weaknesses internal to the specific cross-border economic zones,
while external factors are comprised of the opportunities and threats posed by the
environment external to the specific cross-border economic zones. Then, the results form a
basis leading to further formulate strategies for regional and local border economic zones
development and for further integration into cross-border regional development with
bordering countries. The SWOT analysis is divided into the internal and external factors
focusing on development prospect of the studied Thai border districts and potential
linkages with counterpart border districts in Cambodia, Lao PDR and Myanmar.
The internal factors attributed to Thai border districts comprised of (1) strengths including
locational border advantages, structure of cross-border economy, border entrepreneurships
and settlements; and (2) weaknesses encompassing internal problems or constraints
hindering progressive SBEZ development. The external factors affecting the Thai border
districts involved (1) opportunities for optimizing development potentials including
specific enabling national policies; rules and regulations; and regional agreements
229
conducive to development of special border economic zones; and (2) threats assessed from
hindering measures, rules and regulations in counterpart bordering districts of Cambodia,
Lao PDR and Myanmar, which could affect tangible implementation of special border
economic zones in counterpart border districts of Thailand. Subsequently, the results of the
above SWOT analysis are rationally employed as basis for recommendations on
corresponding regional and local development strategies and programs for further
integration into cross-border regional development with counterpart bordering districts as
follows:
1) Cross-Border Economic Zone 1: Aranyaprathet district of Sakaeo province in
Thailand Bordering with OChrov district in Banteay Meanchey province of
Cambodia
(1) Strategies
Place special emphasis on border endogenous MSMEs with strong local resource
endowments as priority industrial investments. This can be executed by clustering border
industrial development. It can help strengthen border industrial entrepreneurship, as well as
create sustainable employment opportunities to both local Thai nationals and to some
extent, the bordering Cambodian nationals. The domestically relocated SMEs and large
industries or foreign direct investments should be made eligible to investment incentives
rendered by the Royal Thai Government. If local border raw material is scarce, importing
from bordering OChrov district of Cambodia should be allowed with fast track
facilitation.
It is necessary to sustain local backward linkages, which should be initiated by the
Ministry of Industry and Federation of Industry through promotion of industrial production
clusters in line with the needs of respective countries and focusing on the interests of the
local communities. Cross-border outsourcing in specific industries from Aranyaprathet
district in Thailand to border OChrov district in Cambodia should be boosted in order to
promote cross-border supply chain linkages.
Continuously promote cross-border contract farming from Sakaeo province to
bordering Banteay Meanchey province of Cambodia to help uphold income generation and
poverty reduction along border areas. Additionally, imported agricultural produce can be
supplied as raw materials for local border industries.
Relax and revise regulations to make them favorable for cross-border trade
undertaking. Encourage establishment of associations for cross-border trade and logistics
in order coordinate cross-business transactions in an organized manner. The association
will be a platform for exchanging cross-border trade practices, problems and possible
solutions. This association will also liaise with concerned government agencies in
nurturing entrepreneurships and tackling constraints to cross-border trade. Likewise, it
should also promote collective participation of border community-based enterprises and
cooperatives to integrate into cross-border economy.
Innovate modern modes of cross-border payment to support cross-border trade
(e.g., internet banking and e-Commerce), which can help reduce cost, complexity, risk and
improve efficiency.
Expand market penetration to both bordering Banteay Meanchey province and
across Cambodia. In parallel, cross-border transit trade to Vietnam should be facilitated.
Promote Rong Klea Integrated Border Market as emerging center for distributing
goods within Thailand and across Cambodia.
Foster cross-border shopping as a means to generate and distribute income to local
border communities and Sakaeo province.
230
(2) Programs
Provide quality infrastructures in response to rapid urbanization and development
of border economic zone in Aranyaprathet district. This consists of (1) physical
infrastructure (e.g., truck terminal, distribution center, bridge, road and additional border
checkpoints) that will ease traffic congestions at the main entry point; (2) social
infrastructure involving school, hospital, public safety, Customs, Immigration and
Quarantine (CIQ) and urban planning; and (3) environmental infrastructure comprising of
solid waste disposal, waste water treatment and natural resource management, etc.
Deliver skills training in response to specific needs of both local Thai nationals and
bordering Cambodian labor.
Support cross-border shared utilization of social and economic infrastructures (e.g.,
skills training center, hospital and airport, etc.). This will help alleviate shortcomings, as
well as manage the efficient use of infrastructures.
Enhance inclusive border advancement through sustainable rural development in
order to alleviate poverty. Border food cooperatives should be promoted, taking advantage
of emerging local cross-border market. Furthermore, foster balanced urban-rural relations
in Aranyaprathet district in order to fully integrate into the cross-border, regional and
national economy.
(3) Projects
Render training for upgrading of local border wholesalers to become local crossborder traders.
Provide markets for local border retailing in order to create jobs for the interest of
local residents.
Legalize informal border retailing in order to effectively manage local border
economy, as well as generate revenue for local government.
(4) Regulatory Measures
Allow daily cross-border movement of migrant labor from bordering OChrov
district of Cambodia. This can help sustain production of border industries and trade based
on spatial division of labor between Thailand and Cambodia. Aranyaprathet Border
Economic Zone should be exempted from the regulated minimum daily wage. Instead,
floating wage rate for cross-border labor market should be adopted in order to attract
greater investments into Aranyaprathet Border Economic Zone.
2) Cross-Border Economic Zone 2: Muang Mukdahan district of Mukdahan province
in Thailand Bordering with Kaysone Phomvihane district of Savannakhet
province in Lao PDR
(1) Strategies
Place particular emphasis on border endogenous MSMEs with strong local resource
endowments as priority industrial investments. This can be executed by clustering border
industrial development. It can help to strengthen border industrial entrepreneurships, as
well as create sustainable employment opportunities to both local Thai nationals and to
some extent the bordering Laotian nationals. The domestically relocated SMEs and large
industries or foreign direct investments should be made eligible to investment incentives
rendered by the Royal Thai Government. If local border raw material is scarce, importing
from bordering Kaysone Phomvihane district of Lao PDR should be allowed with fast
track facilitation.
It is necessary to sustain local backward linkages, which should be initiated by the
231
local residents.
Legalize informal border retailing in order to effectively manage local border
economy, as well as generate revenue for local government.
(4) Regulatory Measures
Allow daily cross-border movement of migrant labor from bordering Kaysone
Phomvihane district of Lao PDR. This can help sustain production of border industries and
trade based on spatial division of labor between Thailand and Lao PDR. Muang Mukdahan
Border Economic Zone should be exempted from regulated minimum daily wage. Instead,
floating wage rate in the cross-border labor market should be adopted in order to attract
greater investment into Mukdahan Border Economic Zone.
3) Cross-Border Economic Zone 3: Maesod district of Tak province in Thailand
Bordering with Myawaddy district in Kayin State of Myanmar
(1) Strategies
Place particular emphasis on endogenous border MSMEs for fashion industries
with strong local resource endowments, as priority industrial investments. Strive to
upgrade type of production from being Original Equipment Manufacturer (OEM) to
become Original Brand Manufacturer (OBM) with strong link in the global commodity
chain. This can be executed by clustering border industrial development, which can help
strengthen the border industrial entrepreneurships, as well as create sustainable
employment opportunities to both local Thai nationals and to some extent, the bordering
Burmese nationals. The domestically relocated SMEs and large industries or foreign direct
investments should be made eligible to investment incentives rendered by the Royal Thai
Government. If local border raw material is scarce, importing from bordering Myawaddy
district should be allowed with fast track facilitation in order to promote cross-border
supply chain linkages.
Promote research and development to local border fashion industries.
It is necessary to sustain local backward linkages focusing on the interests of the
local border communities. Cross-border outsourcing in specific industries from Maesod
district to bordering Myawaddy district should be enhanced.
Continuously promote cross-border contract farming from Tak province of
Thailand to bordering Kayin state of Myanmar to help uphold household income
generation and poverty reduction along border areas. Additionally, imported agricultural
produce can be supplied as raw materials for local border industries.
Encourage establishment of associations for cross-border trade and logistics in
order to coordinate cross-border business transactions in an organized manner. The
association will be a platform for exchanging cross-border trade and logistics practices,
problems and possible solutions. This association will also liaise with concerned
government agencies in nurturing entrepreneurships and tackling constraints to crossborder trade and logistics.
Relax and revise regulations to make them favorable to cross-border trade and
logistics. Likewise, collective participation of border community-based enterprises and
cooperatives should be promoted to integrate into the cross-border economy.
Introduce modern modes of cross-border payment to support cross-border trade
(e.g., internet banking and e-Commerce) which can help reduce cost, complexity, risk and
improve efficiency.
Expand market penetration to bordering Kayin state and across Myanmar. In
parallel, cross-border transit trade to India and Bangladesh should be facilitated.
233
Upgrade Rim Moei Border Market as emerging center for distributing goods both
within Thailand and across Lao PDR.
Promote cross-border shopping as a means to generate and distribute income to
local border communities and Tak province.
(2) Programs
Provide or upgrade quality infrastructures in response to rapid urbanization in
Maesod district. This consists of (1) physical infrastructure (e.g., truck terminal, bridge,
airport and by-pass road) that will ease traffic congestion at the main border checks point;
(2) social infrastructure involving school, skill training center, hospital, public safety,
Customs, Immigration and Quarantine (CIQ) and urban planning; and (3) environmental
infrastructure comprising of solid waste disposal, waste water treatment, natural resource
management and disaster preparedness, etc.
Foster cross-border shared utilization of social and economic infrastructures (e.g.,
skill training, hospital and airport, etc.). This will help alleviate shortcomings, as well as
manage efficient use of infrastructures.
Enhance inclusive borderlands advancement through integrated and sustainable
rural development in order to alleviate poverty. Promote establishment of border food
cooperatives by grasping advantage of emerging local cross-border market. Moreover,
foster balanced urban-rural relations in Maesod district in order to fully integrate into the
cross-border, regional and national economy.
(3) Projects
Render training for upgrading of local border wholesalers to become local crossborder traders.
Provide markets for local border retailing in order to create jobs for the interest of
local residents.
Legalize informal border retailing in order to effectively manage local border
economy, as well as generate revenue for local government.
(4) Regulatory Measures
Arrange daily cross-border movement of migrant labor from bordering Myawaddy
district of Myanmar. This can help sustain production of border industries and trade based
on spatial division of labor between Thailand and Myanmar. Maesod Border Economic
Zone should be exempted from regulated minimum daily wage. Instead, floating wage rate
in the cross-border labor market should be adopted in order to attract greater investments
into Maesod Border Economic Zone.
234
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245
246
Attribute
Method of Analysis
and Analytical Tools
Content analysis
Spatial analysis
1.1 Locational
advantages
1.2 Connectivity
Department of Highways
Border cities offices
Customs Houses in the study
areas
Provincial Transport Office
Content analysis
1.3.2 Economic
linkages
Locational analysis
Comparative crossborder analysis
Questionnaires
247
2. To study the social
and economic
Variable/Parameter/Indicator
Demographic
247
Objective
characteristics of the
joint border economic
zones for promoting
cross-border production
linkages and share of
employment and
income potential.
Attribute
Social
Economic
248
3. To analyze the policy Policy instruments
instruments at different
levels for upholding
development of border
economic zones.
Variable/Parameter/Indicator
-Gender ratio
-Nativity
-Immigration
-Primary education
-Secondary education
-Marital status
-Home ownership
-Local main occupation
-Local supplementary occupation
-Cross-border-labor movement
-Types of industrial development
-Border industrial productions
-Employment of both Thai and
neighboring countries labor force
-Local backward industrial linkages
-Cross-border industrial linkages
- Cross-border out-sourcing
- Cross-border technology transfer
- Cross-border joint venture
-Special border economic zone
development policies
-Trade policies particularly on crossborder trade
-Industry and Investment
-Visa
-Transport
-Customs and logistics
-Labor
-Tourism
248
Method of Analysis
and Analytical Tools
Questionnaires
Questionnaires
NESDB
Board of Investment
Department of Foreign Trade
Department of Trade
Negotiations
Ministry of Transport
Department of Customs
Ministry of Labor
Ministry of Foreign Affairs
National Security Council
Policy analysis
Objective
Attribute
249
5. To recommend and Development of
Variable/Parameter/Indicator
Method of Analysis
and Analytical Tools
-National security
-Official development assistance
Cross-border contract farming
-Quantity of cross-border import of
commodities under contract farming
with neighboring countries
- Major imported commodities
Peoples mobility
- Cross-border social visits
- Number of cross-border Thai national
tourists
- Number of cross-border neighboring
countries nationals tourists
- Number of cross-border foreign
national tourists
Cross-border shopping
- Quantity of cross-border shopping
- Value of cross-border shopping
- Major shopping commodities
-Number of cross-border Thai national
shoppers
- Number of cross-border neighboring
countries national shoppers
-Strategy for overall development of
Questionnaires
SWOT Analysis
249
Objective
Attribute
border economic
zones in the context
of regional and
national
development
Variable/Parameter/Indicator
special border economic zones in
Thailand.
-Strategy for development of specific
special border economic zones in
Thailand linking with counterparts in
Cambodia, Lao PDR and Myanmar.
250
250
Method of Analysis
and Analytical Tools
Appendix B
Questionnaire for Cross-Border Large Scale Trader
Name of respondent:
House number:
Village number:
Name of the village:
Name of Sub-District:
Name of District:
Province:
Country: Thailand/Myanmar/Cambodia/Lao PDR (please underline the corresponding
country)
***************************************************************
1. Sex of respondent
a ( ) male b ( ) female
2. What is your race?
a ( ) Thai b ( ) Cambodian c ( ) Laotian d ( ) Burmese
3. Marital status
a ( ) single b ( ) married c ( ) divorced d ( ) widowed e ( ) other please
specify.
4. How old is the respondent?
a ( ) < 30 years old b ( ) 30-45 years old c ( ) 45-60 years old d ( )> 60 years old
5. What is your educational attainment level?
a ( ) illiterate b ( ) elementary school c ( ) lower secondary school d ( ) higher
secondary school e ( ) college f ( ) bachelor degree g ( ) master degree
6. Are you native border resident?
a ( ) yes b ( ) no
If No, How long have you been living in your border city?
a ( )<5 years b ( ) 5-10 years c ( ) 10-15 years d ( ) 15-20 years e ( )>20 years
7. What is your cross-border trade segment?
a ( ) Export only
b ( ) Import only
c ( ) Both export and import
d ( ) Combination of export, import and wholesaling
e ( ) Integrated export and import, wholesaling and retailing
f ( ) Shipping services
g ( ) Re-export only
8. What type of your business registration?
a ( ) merchant shop b ( ) tax payer c ( ) partnership limited d ( ) ordinary partnership
e ( ) company limited
251
252
253
254
Appendix C
Questionnaire for Border Wholesaler
Name of respondent:
House number:
Village number:
Name of the village:
Name of Sub-District:
Name of District:
Province:
Country: Thailand/Myanmar/Cambodia/Lao PDR (please underline the corresponding
country)
*************************************************************
1. Sex of respondent
a ( ) male b ( ) female
2.What is your race?
a ( ) Thai b ( ) Cambodian c ( ) Laotian d ( ) Burmese
3. Marital status
a ( ) single b ( ) married c ( ) divorced d ( ) widowed e ( ) other please
specify
4. How old is the respondent?
a ( ) < 30 years old b ( ) 30-5o years old c ( ) 50-60 years old d ( )> 60 years old
5. What is your educational attainment level?
a ( ) illiterate b ( ) elementary school c ( ) lower secondary school d ( ) higher
secondary school e ( ) college f ( ) bachelor degree g ( ) master degree
6. Are you native border resident?
a ( ) yes b ( ) no
If No, How long have you been living in your border city?
a ( )<5 years b ( ) 5-10 years c ( ) 10-20 years d ( ) 20-30 years e ( )>30 years
7. How much is your monthly household income in Thai Baht or Thai Baht equivalent?
a ( ) <30,000 Baht b ( ) 30,000-100,000 Baht c ( ) 100,000-170,000 Baht
d ( ) 170,000-240,000 Baht e ( ) 240,000-310,000 Baht f ( ) 310,000-380,000 Baht
g ( )> 380,000 Baht
8. Do you register your wholesaling business?
a ( ) yes b ( ) no
If Yes, what is the type of registration?
a ( ) merchant shop b ( ) tax payer c ( ) partnership limited d ( ) ordinary partnership
e ( ) company limited f ( ) non-governmental organization
9. How long have you established your business?
255
256
a(
b(
c(
d(
e(
257
Appendix D
Questionnaire for Border Retailer
Name of respondent:
House number:
Village number:
Name of the village:
Name of Sub-District:
Name of District:
Province:
Country: Thailand/Myanmar/Cambodia/Lao PDR (please underline the corresponding
country)
***************************************************************
1. Sex of respondent
a ( ) male b ( ) female
2.What is your race?
a ( ) Thai b ( ) Cambodian c ( ) Laotian d ( ) Burmese
3. Marital status
a ( ) single b ( ) married c ( ) divorced d ( ) widowed e ( ) other please
specify.
4.How old is the respondent?
a ( ) < 30 years old b ( ) 30-50 years old c ( ) 50-60 years old d ( )> 60 years old
5. What is your educational attainment level?
a ( ) illiterate b ( ) elementary school c ( ) lower secondary school d ( ) higher
secondary school e ( ) college f ( ) bachelor degree g ( ) master degree
6. Are you native border resident?
a ( ) yes b ( ) no
If No, How long have you been living in your border city?
a ( )<5 years b ( ) 5-10 years c ( ) 10-15 years d ( ) 15-20 e ( )> 20 years
7. How much is your monthly household income in Thai Baht or Thai Baht equivalent?
a ( ) < 30,000 Baht b ( ) 30,000-50,000 Baht c ( ) 50,000-70,000 Baht
d ( ) 70,000-90,000 Baht e ( ) >90,000 Baht
8.Do you register your retailing business?
a ( ) yes b ( ) no
If Yes, what is the type of registration?
a ( ) merchant shop b ( ) tax payer c ( ) partnership limited d ( ) ordinary partnership
e ( ) company limited
9.How long do you establish your business?
a ( ) <5 years b ( ) 5-10 years c ( ) >10 years
258
10.What is your retailed commodity? You can provide more than 1 answer.
a ( ) consumer goods b ( ) cosmetics c ( ) food products d ( ) electric appliances
e ( ) brand-new clothes f ( ) brand-new shoes g ( ) secondhand shoes h ( ) brand-new
leather i ( ) secondhand leather j ( ) fashion accessories k ( ) kitchenwares l ( ) liquor
and beverage m ( ) cigar n ( ) glass and watch o ( ) bedding p ( ) toys q ( ) jewelry
r ( ) wood products s ( ) spare part of motorcycles and bicycles t ( ) forest products
u ( ) dry freshwater fish v ( ) fruits and vegetables w ( ) machines x ( ) IT products
y ( ) home decoration products z ( ) stationery a.2 ( ) construction materials
a.3 ( ) agricultural produce
11.Where do you procure retailed goods? You can provide more than 1 answer.
a ( ) local community enterprise b ( ) local wholesalers c ( ) regional wholesalers
d ( ) wholesalers in capital city e ( ) cross-border wholesalers f ( ) cross-border
wholesalers in capital city g ( ) local manufacturers h ( ) cross-border manufacturers in
capital city/bordering city i ( ) produced by your own business k ( ) cross-border
community-based enterprises
12.Where is your country origin of sold goods? You can provide more than 1 answer.
a ( ) Thailand b ( ) Lao PDR c ( ) Cambodia d ( )Myanmar e ( ) Vietnam
f ( ) Malaysia g ( ) Singapore h ( ) Indonesia i ( ) China i ( ) India j ( ) Hong Kong
k ( ) South Korea l ( ) Taiwan m ( ) Japan n ( ) USA o ( ) Switzerland p ( ) UK
13.Do you engage any labor?
a ( ) yes ( ) no
If Yes, How many labors do you employ?
a ( )<5 workers b ( ) 5-15 workers c ( ) >15 workers
14. Do you employ any immigrant labor?
a ( ) yes ( ) no
If Yes, how many immigrant workers do you hire?
a ( )<5 workers b ( ) 5-15 workers c ( ) >15 workers
15. How much do you pay for engaged labor?
a ( )< 50 Baht b ( ) 50-80 Baht c ( ) 80-110 Baht d ( ) 110-150 Baht e ( )> 150 Baht
16. What is your reason for employing immigrant labor?
a ( ) local Thai labor for is choosy for jobs.
b ( ) shortage of local Thai labor force in your border city.
c ( ) immigrant labor is cheap; so you can reduce labor cost.
d ( ) competent communication of neighboring countrys language
e ( ) possess specific skill and craftsmanship.
17.What is cross-border movement pattern of immigrant labor?
a ( ) daily b ( ) seasonal c ( ) circular d ( ) long-stayed immigration with all family
members
259
Appendix E
Questionnaire for Cross-Border Shopper
Name of respondent:
Name of District:
Province:
Country: Thailand/Myanmar/Cambodia/Lao PDR (please underline the corresponding
country)
*****************************************************
1. Sex of shopper
a ( ) male b ( ) female
2. What is your marital status?
a ( ) single b ( ) Married c ( ) divorced
3.What is your age?
a ( ) < 30 years old b ( ) 30-60 years old c ( ) >60 years old
4.What is your original resident?
a ( ) study border district b ( ) study border province c ( ) neighboring province
d ( ) capital city e ( ) other regions
5. Where is your shopping place?
a ( ) border market b ( ) border duty free shop
c ( ) border city market d ( ) leading modern border retail store
6. What is your shopped commodity?
a ( ) liquor and wine b ( ) cigar c ( ) fashion purse d ( ) ready to wear garment
e ( ) shoe f ( ) mobile phone g ( ) consumer goods h ( ) electric appliances
i ( ) computer and parts j ( ) household goods k ( ) medicines and medical apparatuses
l ( ) herbal medicines m ( ) mushroom n ( ) fruit and vegetable o ( ) food stuff
p ( ) sea aquatic product q ( ) chemical fertilizer r ( ) forest product
7. What is your spending amount per each shopping?
a ( ) <2,500 Baht b ( ) 2,500-3,500 Baht c ( ) >3,500-2500 Baht
8. How frequent do you make cross-border shopping?
a ( ) daily b ( ) weekly c ( ) monthly d ( ) every 3-month
e ( ) every 6-month f ( ) rarely
9.What is your purpose for shopping?
a ( ) own consumption b ( ) resale c ( ) both own consumption and resale
10.What is mode of cross-border transport?
a ( ) passenger car b ( ) international scheduled bus/van c ( ) international river boat
d ( ) tourist bus e ( ) car rental f ( ) local transport g ( ) bicycle h ( ) on foot
260
Appendix F
Questionnaire for Border Industrialist
Name of respondent:
Name of company:
Village number:
Name of the village:
Name of Sub-District:
Name of District:
Province:
Country: Thailand/Myanmar/Cambodia/Lao PDR (please underline the corresponding
country)
*************************************************
1. Sex of the respondent
( ) male b ( ) female
2. Where is the country of origin of your company?
a ( ) Thailand b ( ) Myanmar c ( ) Cambodia d ( ) Lao PDR e ( ) South Korea
3.What does your type your industrial registration?
a ( ) company limited b ( ) ordinary partnership c ( ) partnership limited d ( ) cottage
industry
4 Does your company gain investment promotion privileges?
a ( ) yes b ( ) no
If yes, from which country?
a ( ) Thailand investment incentives in Zone 3 b ( ) Myanmar investment incentives
c ( ) Cambodia investment incentives d ( ) Lao PDR investment incentives
e ( ) Thailand outward investment incentives
5. Are you endogenous border industries?
a ( ) yes b ( ) no
If No, What is your reason for locating border industries?
a ( ) close proximity to market in bordering city/country
b ( ) access to abundant local labor
c ( ) access to abundant raw materials in bordering city
d ( ) access to abundant labor in bordering city
e ( ) access to abundant local materials
f ( ) local market expansion
6. What is your purpose of border industrial establishment?
a ( ) open new factory or service together with headquarter.
b ( ) open new branch plant.
c ( ) being domestically out-sourced.
d ( ) being cross-border out-sourced.
e ( ) being cross-border franchising.
261
262
263
264
265
Appendix G
Questionnaire for Border Household
Name of respondent:
Village number:
Name of the village:
Name of Sub-District:
Name of District:
Province:
Country: Thailand/Myanmar/Cambodia/Lao PDR (please underline the corresponding
country)
**********************************************
1.Sex of respondent
a ( ) male b ( ) female
2.What is your marital status?
a ( ) single b ( ) married c ( ) divorced d ( ) widowed
3.What is your educational attainment?
a ( ) illiterate b ( ) elementary school c ( ) lower secondary school d ( ) higher
secondary school e ( ) vocational certificate f ( ) bachelor degree g ( ) master degree
4.How much is your monthly household income in Thai Baht or Thai Baht equivalent?
a. ( ) <3,000 Baht b ( ) 3,000-15,000 Baht c ( ) >15,000 Baht
5. How much is your monthly household expense in Thai Baht or Thai Baht equivalent?
a ( ) <3,000 Baht b ( ) 3,000-6,000 Baht c ( ) 6,000-9,000 Baht d ( ) 9,000-12,000 Baht
e ( ) 12,000-15,000 Baht f ( ) 15,000-18,000 Baht g ( ) >18,000 Baht
6. What is the distance from your home to your border city center?
a ( ) you live within the zone of city center b ( ) 4-5 Km away from border city center
c ( ) 5-10 Km from border city center d ( ) 10-15 Km from border city center
e ( ) 15-20 Km from border city center f ( )>20 Km from border city center
7.How many member do you have in your family?
a ( ) <2 members b ( ) 2-4 members c ( ) 4-6 members
d ( ) 6-8 members e ( ) 8-10 members f ( ) > 10 members
8. How many child and elderly do you have in your family?
a ( ) None b ( ) <1 member c ( ) 2-3 members d ( ) 3-4 members
e ( ) 4-5 members f ( ) 5-6 members g ( ) > 6 members
9.Does your family has home ownership?
a ( ) yes b ( ) no
If No, how does your family manage the house?
a ( )you family rents the house b ( ) you family lives on government land c ( ) being
squatter settlement d ( ) company shelter e ( ) lives with parents/relatives
266
267
268
27. How much any benefit do you get after opening the border in the last 5 years?
a ( ) not at all b ( ) low c ( ) moderate d ( ) high e ( ) very high
269
Appendix H
Checklist for Group Discussion of Local Border Community Leader
Name of District:
Name of Province:
Country:
*****************************************************
1. What is the major occupation of local border people?
2. How is the employment and unemployment situation of local people in your border city?
3. Is there any out-migration of local people to either larger cities or bordering cities ?
4. Do communities get benefits from greater improvement of cross-border connectivity
(road, rail, and river pier links)?
5. How often does your community interact with bordering communities?
6. How do you rate the strength of community-based organizations/community-based
enterprises in your communities/border city?
7. What does the benefit that local communities get from cross-border trade?
8. How large of illegal and legal immigrant workers in your communities/border city?
9. What is the impact of influx of immigrant workers in your communities/border city?
10. Does your community based enterprise establish linkages with local industries?
11. What is the impact of exporting/importing of contract farming commodities in your
communities/border city?
12. How should we integrate community-based enterprises into local and cross-border
economies?
270
Appendix I
Checklist of Key Informant Interview
(Border Provincial Governor)
Name of Province:
Country:
***************************************************
1. What are the relations between your province and adjacent bordering province?
2. Do you have economic and social development plan or strategy to promote closer
cooperation with bordering province?
3. What is the problem hindering cooperating between your province and adjacent
bordering province?
4. What is the prospect for fostering closer economic and social ties between your province
and adjacent bordering province?
271
Appendix J
Checklist for Key Informant Interview
(Members of Provincial Chamber of Commerce, Members of Provincial Industry
Federation and Cross-Border Logistics Service Providers)
Name of District:
Name of Province:
Country:
****************************************************
1. What is the role of commerce and industry to local, border city or cross-border
cities development?
2. How does effectiveness of government policy to facilitate cross-border trade in
your border city?
3. How does local commerce and industry get benefit from greater improvement of
connectivity?
4. Have you established linkages with communities-based enterprises? If so, in what
way?
5. What is the impact of influx of illegal and legal immigrant labor to your business
and community? Both positive and negative impacts?
6. How often does your interact with your counterparts in border cities in neighboring
countries?
7. Do you have any cross-border joint venture or cross-border investment in border
cities in neighboring countries? In what form?
8. Have you established cross-border business and production linkages with border
cities in neighboring countries?
9. How does competitiveness of your company/industry to take advantage of
locational advantages and the likely arrival of MNCs to be set up in your
communities or border city?
10. What should the local government do to manage the growth of the border cities
towards special border economic zone?
11. What should the central government further do to promote expansion of crossborder trade, industry cooperation and cross-border logistics services?
272
Appendix K
Linkages of Research Objectives, Findings and Implications
Research objectives
1. To assess the
locational advantages,
linkages and potential
with respective
neighboring countries
and account for flows
of goods and services
through cross-border
trade.
273
2. To study the social
and economic
characteristics of the
joint border economic
zones for promoting
Findings
Implications
Fostered by both geographical adjacency of structural differences and the contributing factors, the Policies
pattern of local and regional cross-border trade, as well as cross-border transit trade have shown a Promote the application of Thai Baht as key currency for
rising trend. Using an 18-year time series data from 1996-2013, the cumulative formal crosscross-border trade transactions between Thailand and
border trade value between Thailand and 4-neighboring countries has reached 200.40 billion US$
bordering countries. Furthermore, internationalize Thai
with a share of 58.66 % of total international trade value with these 4-neighboring countries. As a
Baht currency across the Greater Mekong Sub-region,
result, cross-border trade flows in the study cross-border regions are highly significant. The
which can help facilitate cross-border payment.
cumulative share of cross-border export to these neighbors is as high as 59.40 %; whereas, the
Provide quality cross-border infrastructure linkages, as
cumulative share of cross-border import was at 40.59 %, contributed by Malaysia (56.15 %),
well as promoting cross-border trade facilitation,
Myanmar (35.39 %), Lao PDR (6.82 %) and Cambodia (1.62 %).As a result, Thailand gained
investment and people movement. Also, negotiate and
substantially cumulative balance of cross-border trade at 37.69 billion US$. During enforcement
facilitate cross-border transit trade with nearby countries,
of AFTA (from 2002-2013), cross-border trade growth significantly kept increasing by 22.47 %
e.g. Vietnam, China, India and Bangladesh, etc.
per year. Above all, when the specified AFTA tariffs became 0 % in 2010, its annual cross-border Control and overcome the section of illegal cross-border
trade growth considerably increased to 32.08 % compared with 2009.With increasing trend of
trades in order to bring tradable goods under formal crossinternational trade of Thailand, the intra-ASEAN trade and cross-border trade are also gradually
border trade undertaking, which can be suppressing large
rising though the proportion of share is low. Cross-border trade during 2008-2013 has reached
scale import of low quality agricultural commodities into
significant level sharing average of 30.77 % to intra-ASEAN trade. Similarly, the share of crossThailand and recover the loss of revenue to both Thailand
border trade to Thailands aggregate international trade with the world significantly rose from
and bordering countries.
1.02 % in 1996 to 6.48 % in 2012 or equivalent to 7.67 % of Gross Domestic Product. CrossRegulatory measure
border trade growth may somehow contribute to regional development as both urban and rural
Create a new set of regulations favorable for cross-border
people including the poor along border regions between Thailand and neighboring countries can
trades and be independent from the existing broad
also benefit from trade, as well as accessing to variety of products.
regulations of international trade. This is because crossborder trade between Thailand and neighboring countries
are somewhat different track. Therefore, it is necessary to
design such regulations in response to the changing crossborder trade environment in the context of ASEAN
Community and other regional cooperation programs e.g.
ASEAN and China and ASEAN and India, etc.
The key findings of comparative cross-border analyses are as follows:
2.1 Cross-border large scale trading: Cross-border trading is mostly undertaken by local border Strategies
residents across the cross-border regions. Most of cross-border trader respondents across the Introduce modern modes of cross-border payment to
regions are family based businesses and being mainly small and medium-sized enterprises support cross-border trade e.g. internet banking and e(SMEs). The length of establishment across the regions is between 11 to13 years. Thai goods are Commerce, which can help reduce cost, complexity, risk
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Research objectives
cross-border
production linkages
and share of
employment and
income potentials.
274
Findings
widely accepted among bordering countries. Cross-border exported commodities across the Thai
border districts are quite similar pattern, mainly consisted of consumer goods, intermediate and
capital goods. Whereas, cross-border imported commodities from bordering districts are mostly
agricultural produces. There are strong supply chain linkages between Thai border districts with
the core area of Bangkok metropolis and its vicinity and vice versa. However, cross-border traded
goods are mainly produced in Bangkok metropolis and its vicinity such as eastern region and
other centers. At present, Thai border cities and towns mainly play distribution role. Cross-border
traders play important role in promoting cross-border supply chain linkages. Thai goods hold a
large market share at the varying range of 38 % to 77 % of total traded commodities across the
cross-border regions. Collectively, ASEAN goods hold high market share in the range of 78.30 %
to 100 % across the regions. Payment by cash is widely adopted across the cross-border regions
as matter of convenience. Cross-border trader respondents across the bordering districts engaged
higher number of local labor between 12 to 41 workers mainly for loading and unloading
activities. Whereas, respondents across Thai border districts have employed lower number of
local and immigrant labor with a range of 7 to 10 workers. Only respondents across the Thai
border districts employed immigrant labor, at the range from 5 to 9 workers. The daily wage rates
across the Thai border districts are higher than counterpart study bordering districts and it is
approximately by 3 times. Respondents across Thai border districts of Maesod; Muang Mukdahan
and Aranyaprathet have performed cross-border transit trade to Vietnam at 5.60 %; 16.60 % and
22.70 %, respectively. Improvement of cross-border connectivity e.g. roads and international
river bridges facilitated cross-border trade. The respondents have perceived that border banking
and Customs, Immigration and Quarantine (CIQ) services across the border districts of Thailand
are noticeably well organized than the counterparts of bordering study districts.
Implications
and improve efficiency.
Expand market penetration to bordering provinces and
across bordering countries.
Encourage establishment of associations for crossborder trade and logistics in order to coordinate crossborder business transactions in an organized manner. The
association will be a platform for exchanging cross-border
trade and logistics practices, problems and possible
solutions. This association will also liaise with concerned
government agencies in nurturing entrepreneurships and
tackling constraints to cross-border trade and logistics.
Promote collective participation of border communitybased enterprises and cooperatives to integrate into the
cross-border economy.
2.2 Local border wholesaling: Most of border wholesaler respondents across the cross-border
regions are family based businesses and belong to SMEs. The average length of establishment is
14 years. Respondents across the cross-border regions sell a wide range of essential commodities.
There are 3 types of cross-border supply chains in the cross-border regions. Respondents across
the Thai border districts get goods mainly from manufacturers in Bangkok metropolis and its
vicinity. Whereas, respondents in the bordering districts mainly obtain goods from cross-border
wholesalers in Thailand. The number of engaged labor across the cross-border regions really
varies from 4 to 14 workers. The number of engaged immigrant labor across the Thai border
districts ranges from 6 to 8 workers. The average daily wage rates across the Thai border districts
are higher than the counterpart bordering districts by 2 to 3 times.
Strategy
Promote Rong Klea Integrated Border Market and other
local border wholesale markets as emerging center for
distributing goods both within Thailand and across
bordering countries.
Project
Render training for upgrading local border wholesalers
towards local cross-border traders.
2.3 Local border retailing: Border retailer respondents across 5 border districts are mainly being
informal retailers. Except in Kaysone Phomvihane district of Lao PDR, where they are registered
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Projects
Research objectives
Findings
Implications
enterprises at 91%, evident from taxpayer registrations. Respondents in 2 Thai border districts of Provide markets for local border retailing in order to
Aranyaprathet and Maesod have longer length of establishment for more than 12 years. While, create jobs for the interest of local residents.
respondents in bordering districts of OChrov district of Cambodia and Myawaddy district of Legalize informal border retailing in order to effectively
Myanmar have establishments within last 6 to 7 years. On the contrary, respondents in Kaysone manage local border economy, as well as generating
Phomvihane district of Lao PDR have longer length of establishment (12 years). In contrast, revenue for local government.
respondents in Muang Mukdahan district of Thailand have lower length of establishment (8
years). They sell almost similar kinds of goods. Respondents across the cross-border regions
mainly procure goods from cross-border wholesalers, which signify the existence of cross-border
supply chain linkages. Goods, which are originated from Thailand, possess market share between
30.30 % to 69.20 % across the cross-border regions. The number of engaged immigrant labor
across Thai border districts vary between 3 to 5 workers. Daily wage rate for immigrant labor
across the Thai border districts are higher than counterpart bordering districts by 2 to 2.50 times.
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2.4 Cross-border shopping: Cross-border shopping is currently on the rising trend due to Strategy
adjacency of structural differences between Thailand and bordering countries e.g. price Promote cross-border shopping as a means to generate and
differences, differing product availability and high quality standards of Thai products. It is also distribute income to local border communities and border
associated with cross-border tourism. Respondents across Thai border districts have greater men provinces.
shoppers ranging from 53.30 % to 62.20 %. Whereas, respondents across the bordering districts
have greater women shoppers ranging from 53.30 % to 56.60 %. The average ages of
respondents across Thai border districts range from 40 to 47 years old. Whereas, the average age
of respondents across the bordering districts are much younger ranging from 24 to 40 years old.
Respondents across Thai border districts originate from other neighboring provinces ranging from
31.10 % to 63.30 %. Whereas, respondents in the 2 bordering districts of OChrov in Cambodia
and Myawaddy in Myanmar are local border residents at 43.30 % and 82.30 %, respectively.
Also, slightly 4 fifth of respondents in Kaysone Phomvihane district of Lao PDR originate from
bordering Savannakhet province.
Shopping places also largely vary across the cross-border regions. Thai cross-border shopper
respondents who come from Muang Mukdahan and Aranyaprathet districts shop at border duty
free shops in bordering Kaysone Phomvihane district of Lao PDR and OChrov district of
Cambodia at 54.20 % and 79.20 %, respectively. While, 3 fifth of Thai shopper respondents in
Maesod district do shopping a wide range of Burmese products at Rim Moei border market,
which is located in Maesod district of Thailand. Whereas, cross-border shopper respondents
across the bordering districts mainly buy at leading modern border retail stores across Thai border
districts, e.g. Tesco Lotus and Big C, etc. ranging from 40 % to 93.30 %. There are different
patterns of shopped commodities across the cross-border regions. Thai shopper respondents in
Muang Mukdahan and Aranyaprathet districts purchase luxury goods, e.g. liquor and wine, which
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Research objectives
Findings
are made in western countries in counterpart bordering districts at 32.10 % and 56.60 %,
respectively. Quite the reverse, greater than 2 third of Thai shopper respondents in Maesod
district buy fresh and dry sea aquatic products in bordering Myawaddy district of Myanmar In
contrast, cross-border shopper respondents across the bordering districts procure consumers
goods ranging from 50 % to 59.40 %. Respondents across the bordering districts spend higher
amount per each shopping. Respondents across the bordering districts perform more frequent
cross-border shopping than those respondents across Thai border districts. Purposes of crossborder shopping are for their own consumption ranging from 40 % to 90 % across the crossborder regions. Modes of cross-border transport noticeably vary across the cross-border regions
depending on geographical and extent of improved infrastructure linkages.
Implications
276
2.5 Local border industrial development: Border industrial developer respondents across Thai Policy
border districts have formal business registrations than counterpart respondents in the bordering Relocate low competitive industries, which required
districts. Interestingly, respondents across the bordering districts gain greater investment labor-intensive production to particular border economic
incentives from respective bordering governments than counterpart respondents across Thai zones so that it can gain advantages of cross-border
border districts. Respondents in Thai border districts have higher exogenous industries. In cooperation and spatial division of labor between Thailand
contrast, respondents in 2 bordering districts have higher endogenous industries. Except in and bordering countries.
OChrov district of Cambodia, it hosts highest exogenous industries (83.30 %).Respondents Strategies
across Thai border districts mostly open new factories or services. Thai border districts have Place special emphasis on border endogenous MSMEs
establishments for more than 7 years. Bordering districts of other countries have establishments industries with strong local resource endowments as
recently within last 4 years.Investment capital significantly varies across the cross-border regions. priority industrial investments. This can be executed in the
Respondents in Thai border districts are mostly small and medium sized enterprises (SMEs), in form of clustering border industrial development. It can
which average capital investment is about 40 million Baht, which is much higher as compared to help strengthen border industrial entrepreneurships, as well
other districts of bordering regions - Myawaddy district of Myanmar and Kaysone Phomvihane as creating sustainable employment opportunities to both
district of Lao PDR, respectively. On the contrary, remarkably 96.70 % of respondents in local Thai nationals and to some extent bordering
OChrov district of Cambodia are informal micro-enterprises with investment capital just about nationals. Regarding either domestically relocated SMEs
0.50 million Baht. Manufactured products or service goods significantly vary across the cross- and large industries or foreign direct investments, it should
border regions. Generally, the Thai border districts are more industrialized than 2 bordering be eligible to investment incentives as rendered by the
districts, except in Kaysone Phomvihane district of Lao PDR, which is more industrialized than Royal Thai Government. If local border raw material is
the counterpart bordering Muang Mukdahan district of Thailand. Remarkably, major productions scarce, it should be allowed importing from bordering
are concentrated related to fashion industries in both Maesod district of Thailand specializing in countries with fast track facilitation.
high-end products and OChrov district of Cambodia specializing in low-end products. It is necessary to sustain the local backward linkages,
Outstandingly, 4/5thof respondents in Maesod district of Thailand are manufacturers of fashion which should be initiated by the Ministry of Industry and
goods, of which 2/3rdof respondents produce high-end wearing apparels and garments. About 10 Federation of Industry by promoting industrial production
percent of respondents make textile products. As a result, Maesod district has become an clusters in line with respective country needs focusing on
important fashion cluster of Thailand and being connected with global community chains. the interests of the local communities and cities along the
Sources of labor noticeably vary across the cross-border regions depending on national and
276
Research objectives
Findings
international division of labor. Respondents across Thai border districts markedly employ semiskilled immigrant labor. On the contrary, respondents across bordering districts mainly engage
internal migrant labor. Cross-border movement patterns of immigrant labor significantly vary
across the cross-border regions. There is existent of international division of immigrant labor by
gender across Thai border districts. Respondents across Thai border districts pay higher wages for
immigrant labor than counterpart respondents in the bordering districts by 1.6 to 3 times.
Respondents across Thai border districts have slightly higher local backward linkages than the
counterparts in the bordering districts. On the other hand, respondents across the bordering
districts have greater cross-border production linkage strategies than the counterpart respondents
in Thai border districts. Strikingly, almost 3 quarters of respondents in Maesod district of
Thailand is only domestically out-sourced productions in the form of Original Equipment
Manufacturer (OEM) from Bangkok metropolis and its vicinity. Regional and cross-border subcontracting linkages are significantly prevalent across the cross-border regions. There is existence
of cross-border market interdependence in the study cross-border regions.
Implications
border.
It is important to promote local direct investments in
providing cross-border logistics
services to be competitive with multinational logistics
providers. In addition, collective efforts for nurturing
entrepreneurship of all types of traders should be initiated
by the Ministry of Commerce and the Thai Chamber of
Commerce.
Foster cross-border outsourcing linkages with counterpart
cities in bordering countries.
Deliver skill trainings in response to specific needs to both
local Thai nationals and bordering Cambodian labor.
Regulatory measure
Regulated minimum daily wage in BEZs should
be exempted. Rather, floating wage rate for cross-border
labor market should instead be adopted in order to attract
greater investments into BEZs.
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2.6 Local border communities: Border women respondents represent between 43 % to 79 % Strategies
across the cross-border regions. Border household respondents across the cross-border regions are Enhance inclusive border advancement through
working and their ages range from 49 to 60 years. Respondents across Thai border districts have sustainable rural development in order to alleviate
higher educational attainments than counterpart respondents in the bordering districts. Monthly poverty. Border food cooperatives should be promoted
household income notably varies across the cross-border regions, and monthly income differences taking advantage of emerging local cross-border market.
are based on the near city center, the more income generated. The disposable monthly household Furthermore, foster balanced urban-rural relations in
incomes across Thai border districts are generally higher than counterpart respondents in the BEZs in order to fully integrate into the cross-border,
bordering districts and ranges from 1.1 to 3 times. Respondents across the bordering districts have regional and national economy.
greater extended families than counterpart respondents in Thai border districts. Respondents
across Thai border districts have greater nativity than counterpart respondents in the bordering
districts. Respondents across Thai border districts have lower landless households than the
counterpart respondents across the bordering districts. Main sources of border household incomes
considerably vary across the cross-border regions. Complementary linkages exist for sources of
household income between Thai border districts and the counterpart bordering districts
particularly on labor and cross-border out-sourcing activities. Respondents across Thai border
districts reflect good practices of community development. Current conditions of secondary roads
across Thai border districts are well developed than the counterpart bordering districts.
Respondents, who are involved in agricultural activities across Thai border districts, are more
market-oriented farmers. After opening the border during the last 5 years, respondents across the
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Research objectives
Findings
bordering districts gained greater economic and social benefits than the counterpart respondents
across Thai border districts.
Development of border economic zones in Thailand is intermittent. However, the current Royal
Thai Government has exerted strong effort through explicit and implicit border economic zone
development policies. Presently, the Prayuth Administration promptly carries on hastening the
implementation process of these 10 SBEZs through favorably integrated development policies.
These are (1) direct policies or explicit policies consist of special border economic zone
development policies; international trade and cross-border trade policies; customs facilitation
policy; border investment and industrial development policies; labor, public health and national
security policies; national and cross-border transport and logistics policies. And (2) Indirect
policies aiming to indirectly sustain development of SBEZs include tourism and visa policies and
international relations, regional cooperation and official development assistance policies.
Nevertheless, there is a slight policy gap on labor cooperation policy with bordering countries,
which needs to be aligned to ensure effective implementation of the SBEZs.
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4. To assess the
benefits
278
Implications
Policies
Adopt border economic zone concept as strategy for
both promoting regional economic development within
Thailand, as well as fostering regional production
networks of Thailand with bordering cities along economic
corridors in order to fully integrate into the ASEAN
Community and global economy.
Integrate the implementation of border economic zones
with national security policies and programs in order to
advance towards integrated borderlands development
between Thailand and bordering countries.
Set up an international institutional mechanism for
administering integrated cross-border economic zones
based on the concept of Two Countries-One Region. It
should then define clear physical boundary of the
integrated cross-border economic zones between Thailand
and bordering countries. Within this region, cross-border
movements of goods, capital, people and vehicle could
freely flow.
An array of aid for trade programs through Ministry of
Foreign Affairs should also be extended to bordering
countries consisting of Cambodia, Lao PDR and Myanmar
in order to address common border development and
management issues.
Strategy
National institutional capacity building for implemented
BEZs should be promoted. As border economic zone
concept is newly adopted in Thailand, a wide range of
capacity building schemes should be provided by Office of
the National Economic and Social Development (NESDB)
and other relevant agencies in order to efficiently deal with
multifaceted issues on BEZs development.
Strategy
Research objectives
(infrastructural,
services, employment
and income, etc.)
gained by respective
cross-border regions
and more particularly
at local and regional
levels.
5.Conclusion
279
Findings
Implications
Thai entrepreneurs or traders to engage with counterpart farmers or entrepreneurs in neighboring Constantly promote cross-border contract farming from
countries of CLM in growing agricultural produce under contract farming since 2004.The Thai border provinces with bordering countries so that it
targeted agricultural produces consisted of 10 farm plants and 3 energy crops. Among the study can help uphold income generation and poverty reduction
areas in Thailand, the local border SMEs entrepreneurs/investors in both Sakaeo and Tak along border areas. Additionally, imported agricultural
provinces get advantages as they are native border residents. Whereas, local border SMEs commodities can be supplied as raw materials for local
entrepreneurs in Mukdahan province are limited. Instead, most of SMEs entrepreneurs originate border industries.
from across the Northeastern region of Thailand. Similarly among bordering provinces, small
famers in both Banteay Meanchey and Battambong provinces of Cambodia and Kayin state of
Myanmar acquire greater benefits than counterpart small farmers in Savannakhet province of Lao
PDR. Nevertheless, the trend of cross-border contract farming intensity across the study crossborder regions is likely to expand.
4.2 Cross-border people and vehicle mobility: During 2002-2014, there was a rapid increase of Strategy
local and regional cross-border people mobility across the cross-border regions. During 2009- Facilitate cross-border people and vehicle mobility
2014, there was a rapid intensity of local and regional cross-border vehicle mobility across the through accelerating Initial Implementation of Crosscross-border regions as well. As a result, the trend of cross-border people and vehicle mobility Border Transport Agreement with bordering countries.
intensities across the cross-border regions are likely to increase in coming years.
With the advent of ASEAN integration, cross-border regions have emerged as new growth
centers. Thailand locates on mainland of greater Mekong sub-region possesses promising geoeconomic and connectivity with bordering countries especially through the realization of the
Greater Mekong Sub-region Corridors particularly for the East-West and Southern economic
corridors. In order to grasp this potential, Thailand has recently materialized to transform existing
interdependent borderlands towards integrated development of special border economic zones
across the country. It is also planned to foster supply chain and production linkages with
counterpart border economic zones in neighboring countries. As a result, overall national border
economic zone development strategies in Thailand have been proposed. Also, a number of
development strategies for specific cross-border economic zones in Thailand consisting of
Aranyaprathet district of Sakaeo province, Muang Mukdahan district of Mukdahan province and
Maesod district of Tak province in order to promote integrated borderlands development and
cross-border regional development with respective bordering districts of OChrov in Cambodia,
Kaysone Phomvihane in Lao PDR and Myawaddy in Myanmar have subsequently been
recommended. The researchs findings have both common and different features in comparison
with other studies.
279