Thailand's Hedging Strategy Towards China(2001-2017)

The question of the small Southeast Asian states' response to China's rising power has been greatly exploring since the turn of the 21 st century.This thesis argues that to understand the SEA states' response to rising China,one has to individually explore each state one by one since SEA states are not a unified actor.Moreover,each SEA nations has developed their diplomatic policies.Hence,this thesis focused on Thailand as the case study on the response of small SEA nations to the rise of China.This thesis aims to address the question to understand why Thailand employ their hedging strategy in such as way and how they employ their hedging strategy.As this kind of question has been attempted to answer by scholars either Thailand employs balancing,bandwagoning,or hedging strategy towards China.This paper attempts to explore precisely how and why Thailand has chosen to adopt their hedging strategy towards China since 2001 and what are the key factors that drive and influence Thailand to pursue such policy.This paper argues that the situations in Thailand domestic politics and Thai ruling elites are critical factors in forming Thailand hedging strategy.The policy of Thailand towards China results from the perceptions of the ruling elites regarding the shifts of the international environment;their home political situations and the opportunities from China for their political legitimacy bolster to gain domestic support for another term of office.To explore the how and why Thailand responds to the rise of China by using hedging strategy.This thesis adopts Kuik's hedging strategy conceptual framework or risk-contingency and returnmaximizing to identify and understand various hedging strategic policies that Thailand pursues.The finding confirms that the vital factor in forming Thailand's hedging strategy is the domestic politics,political ruling elites,and good perception towards China.Thailand is employing hedging strategy towards China while maintaining good military-to-military relations with the United States.Thailand,since 2001,started from Thaksin administration onwards to the present Prayuth administration has been pursuing hedging strategy towards“return-maximizing” policy to bolster its economy gains to leverage to domestic development and to bolster their political legitimacy during their terms.From Thaksin cabinet,Thailand ruling elites are greatly influenced by the domestic political situations,leader's political legitimacy empowerment,perceptions towards China and other existing external power in the region,and the geopolitical of the country among international environment.Ever since Thaksin came into power,he had established more excellent relations with China through economic bilateral and agreements to ensure Thailand continue growing economy along with China's as his opportunity to restore Thailand's domestic economic situations and to bolster his political legitimacy for another political term.Thaksin gained his political legitimacy from his populist,pro-poor people policies to stay in power as Thailand Prime Minister.Being a successful businessman and Chinese ethnic Thai,Thaksin perceives China as a valuable opportunity for his business benefit and nations benefit maximizing.To facilitate and bring about his populist policies,he saw opportunities China could provide and has initiated the change in Thailand foreign policy to pursue hedging strategy by employing fundamental policy such as pragmatic economic policy,limited-bandwagoning with China while employing indirect-balancing through the development of mil-to-mil relations with the United States.Since 2001,Thailand enjoys increasing economic growth with trade and investment from China rapidly.After the 2006 coup,Thailand's hedging strategy turn more towards China due to the suspension of the US financial aid and military,financial support and activities.The US's Section 508 of the US Foreign Operations Appropriations Act of foreign governments disposed of by a military coup greatly influenced Thailand hedging behavior after the 2006 and 2014 military coup.The US suspension on financial aids and military aids created chances and opportunities for Thailand and China to develop and strengthen its ties.Thai elites were disappointed with the US regarding the financial suspension.However,China gained Thai elites trusts because of China's non-interference policy and respect towards Thailand domestic issues as Thailand's issues.Thailand after Surayud,the military-installed government,further strengthen its ties with China through their economic pragmatism policy through the establishment to several FTAs agreement ensuring the two countries collaboration and cooperation in fifteen areas including economic and military.Surayud same with Thaksin,however,had employed the indirect-balancing policy through the development of military-to-military cooperation with the US.Even though the US suspended its military aids but the Cobra Gold,an annual multinational military exercise based in Thailand,continue its cooperation and activities.From 2006 to 2011,Thailand faced its domestic turmoil results in the unstable political affairs and domestic economic situations.The country divided into two sides;yellow shirt(anti-Thaksin ideology)and redshirt(pro-Thaksin ideology).All the government during that time including Surayud,Samak,Somchai,and Abhisit,continued growing ties with Chinathrough their pragmatic economic policies establishment of bilateral agreements and forming of FTAs and also hedging against China with their indirect-balancing policy with the US because their perception about China remained the same when Thaksin came to power.During this time,Thailand still makes sure that it is keeping good relations with both China and US and does not choose any side.After the election in 2011,Yingluck,Thaksin's sister,won the election and became Thailand's first female Prime Minister.She continued her brother's work in the more significant development of the Thailand and China relations,primarily through economic collaborations and cooperation.She pursued the same populist policies mainly for lowerincome farmers.To continued Thailand's economic growth,Yingluck upgrades her bindedengagement and pragmatic economic policy with China by initiating and establishing of many bilateral agreements such as China's Maritime Silk Road and the Asian Infrastructure Investment Bank Initiatives(AIIB),the establishing of Chinese Culture Center in Bangkok and Chinese Confusions Initiatives in Thailand.She also enhances the two countries military cooperation through annual military exercises with China coded Blue Strike.Thailand under Yingluck government also pursue an indirect-balancing policy against China by maintaining it close mil-to-mil relations with the United States through the annual Cobra Gold exercise,scholarship to exchange of military personnel to the US for further their studies,and the allowance to the US army to use Utapao airbase.The hedging strategy shifts greater engagement with China after the 2014 coup.The decreased and downgrade of the Thai-US relations through the suspension of military aid and trade negotiations forced Prayuth,2014 military coup leader and also the military-installed government,to pursue hedging strategy towards more return-maximizing policy with China to facilitate its domestic affairs and also bolstering his political legitimacy.During the 2014 coup,Thailand was in the middle of its domestic instability financially and politically.Facing the failure of Yingluck's rice-pledging scheme lost the country billions of dollars in trade and investment.Thailand annual economic growth rate reduced 0.5 percent.Prayuth,hence,adopted his pro-China pragmatic economic policy to improve and restore Thailand's trade and investment for domestic economic reforms and continue Thailand's economic growth.Moreover,being criticized by the US as the military-installed government which the US froze the military aid worth of US$35 million and suspended US$4.7 million in security-related aid to Thailand,Prayuth had no choice but the turn to China and other countries.To claim the right of staying in power and increasing his political legitimacy,Prayuth seeks to establish anew form and close relations with China with their growing progress in defense,military,economy,and security.He employs pragmatic economic policy by enhancing trade and investment and also finding new markets for Thailand's agricultural goods.Prayuth aims to gains Thailand's rural support by promoting greater economic policies and the development of domestic infrastructure campaign such as Thailand high-speed railway's system.He also strengthens Sino-Thai military relations through an establishment of mil-to-mil bilateral agreements which are politically and militarily benefited to his military-installed government.From the suspension of the US aid,increased the chance of Thailand to improve its relations both economically and politically with China.The domestic politics such as perceptions of political elites towards China,political legitimacy empowerment opportunities in Thailand are a crucial factor in forming the country's hedging strategy.Since Thaksin administration,Thailand has been maneuvering and managing the relationship with China and the US as to avoid choosing sides and also for political elites they maneuvering their foreign policy to maximize the country's benefit to gain their political legitimacy and to facilitate in Thailand's domestic's development.