Trade

Healthcare, hydrogen and more: Saudi-Thai deals in sight

January 11, 2024, 8:55 AM

Saudi Crown Prince Mohammed bin Salman meets Thailand's then Prime Minister Prayut Chan-o-cha in November 2022, during the APEC summit in Bangkok

Diplomatic spat over
Thai bio-hydrogen skills valued
Farming, healthcare on deal list

Saudi Arabia and Thailand are strengthening economic ties with prospective deals in healthcare, hydrogen and agriculture after patching up a longstanding diplomatic spat.

The two nations reached a rapprochement in January 2022, more than three decades after a dispute over a 1989 jewellery heist known as the Blue Diamond Affair.

“The economic opportunities from cooperation between Saudi Arabia and Thailand are significant,” Varavich Hongladarom, a prominent Thai businessman and chief executive of Bangkok-based management consultant Corevarion, told AGBI.

Hongladarom is working with David Gibson-Moore, president of business advisory group Gulf Analytica, and undisclosed parties in Saudi Arabia to tie up deals in bio-hydrogen, farming and healthcare, they said.

“Saudi Arabia is a high-carbon emitting nation that wants to expand its involvement in clean energy,” Hongladarom said. “Thailand can bring its innovation in bio-hydrogen and set up skills training centres for Saudis.

“Saudi Arabia can contribute capital investment to expand Thailand’s bio-hydrogen business in the GCC.”

Within healthcare, he said, there are opportunities in the “longevity” sector, which uses health technologies to predict medical risk and develop medicines to prolong human life.

Thailand has a sizable medical tourism industry and wants to attract more people from the Gulf seeking treatments.

Thailand is also seeking input from Saudi Arabia into a $2 billion fund to support agricultural innovation, especially in plant-based foods, herbal vitamins and fruit farming. There are opportunities to use green hydrogen produced in Saudi to power Thai farms, Hongladarom added.

The prospective deals are worth “billions of dollars”, Gibson-Moore said. “Both countries have distinct social and business cultures and are at the stage where they’re getting to know each other better.”

The UAE is Thailand’s largest Gulf trading partner, but think tank Asia House said in November it expects restored diplomatic ties to increase Thai trade with Saudi Arabia, which in 2022 stood at $9.8 billion.

The countries are aiming to increase bilateral trade by 20 percent annually in 2024 to reach $12 billion, Thai Chamber of Commerce chairman Sanan Angubolkul told the Thailand Mega Fair in Riyadh in December.

The Blue Diamond affair

The 1989 diplomatic spat came about after a Thai cleaner was said to have taken gems, including a rare 50-carat blue diamond, from a palace in Riyadh. Three Saudi diplomats were shot dead in Bangkok following the theft. The blue diamond has never been recovered.

The dispute is said to have cost billions of dollars in lost trade and employment, as Saudi Arabia stopped issuing work visas for Thai nationals and trade flows declined.

Since restoring relations, the two countries have signed five agreements to increase bilateral trade and investment, promote tourism and deepen cooperation in energy.

Direct flights between Saudi Arabia and Thailand have increased. The state energy companies Saudi Aramco and PTT have agreed to work together on carbon capture and crude oil sourcing.

The Saudi-Thai Business Council was established last August, and two agreements on free trade were signed in late 2023.

Saudi Arabia plans to invest $8.5 billion in Thailand this year, focusing on the Eastern Economic Corridor, the country’s industrial centre.