Relevant state agencies must help exporters to take full advantage of lower tariffs under free trade agreements (FTAs), says the Thailand Development Research Institute (TDRI).
Researcher Sunthorn Tunmuntong said inconvenience, a lack of tangible benefits and missing documentation are some reasons why exporters have not used FTAs.
At a conference yesterday on export obstacles, the TDRI estimated 40-50% of exporters have taken advantage of FTAs.
Exporters received tax benefits last year of 118 billion baht under FTAs instead of 248 billion baht if the tax privileges had been fully utilised.
On border trade routes, Mr Sunthorn said officials in neighbouring countries often lack knowledge of the agreements, and the process is time-consuming.
TDRI president Somkiat Tangkitvanich said government agencies should spread information and raise awareness about FTAs and their advantages to exporters, especially in industries with low FTA use.
In Asean, FTAs mean little if a trade partner still imposes non-tariff measures (NTMs) to protect domestic industry from dumping or to achieve economies of scale.
"Government and the private sector must work together to address NTMs," said Paiboon Ponsuwanna, an adviser to the board of the Thai National Shippers' Council.
He wants the government to create a central database to monitor and update information on the NTMs of trading partners.
Big companies have the resources to cope with the effects of the byzantine NTM system, but small and medium-sized firms do not.
"NTMs are very fluid and therefore hard to define," said Amparwon Pichalai, deputy director-general of the International Trade Promotion Department.
He said regionwide definitions of NTMs should be created and ratified by member countries to streamline trade and remove export hurdles.
But Mr Paiboon said this cannot be achieved if the Asean secretariat lacks enforcement power.
The Thai government has maintained its full-year export growth target of 7% to 7.8%, although the Internal Trade Department expects exports to grow by 2.9%.
For the first seven months of this year, Commerce Ministry figures showed exports rising by just 0.6% year-on-year to US$132 billion.
Exports fell for a third month in a row in July, down by 1.5% to $19.1 billion and by 3.4% in Thai currency to 584 billion baht.
But officials remain positive that exports will recover over the next two months on higher purchase orders ahead of Christmas and New Year celebrations.
About the author
- Writer: Nop Tephaval
Position: Business Reporter