Trade with Australia produced a surplus of Bt35.11 billion last year, compared to a deficit of Bt3.47 billion in 2005 when the Thailand-Australia Free Trade Agreement (Tafta) was implemented, the Trade Negotiations Department said yesterday.

Out of the Kingdom's total exports to Australia, those under Tafta's low import tariffs accounted for 63.08 per cent. However, Australia used Tafta's tax privileges for only 13.75 per cent of its exports to Thailand.

Two-way trade grew 14.69 per cent to Bt295.52 billion last year. Thai exports jumped by 30.06 per cent to Bt165.3 billion, while imports from Australia dropped slightly by 0.28 per cent to Bt130.2 billion.

Director-general Chutima Bunyapraphasara said the government was concerned more about any adverse effects from the free-trade agreement on local businesses than trade figures. However, the surplus showed that the FTA was good for exporters.

Tafta has opened up more future trade and investment opportunities for both sides, she said.

Australia's investment here rose to Bt1.81 billion last year under the Tafta agreement to promote high-potential industries, including textiles, steel and metal products, and electronics and parts.

Among these products, steel, textiles, and electronics and parts have attracted Australian investors.

The major goods exported to Australia are automobiles, steel and jewellery, while the major imports from that country are crude oil, diamonds and gold, and steel.

Chutima said Thailand should have a better chance to increase the volume of certain products shipped to Australia if its government accelerates approval of its biosecurity report for imported agricultural commodities, particularly prawns.

Biosecurity Australia proposed restrictions after Australia claimed it would protect its consumers from disease-carrying shrimp and other agricultural products.

The Thai negotiating team is now there trying to convince Australia to cancel the soon-to-be launched stricter requirements for imported shrimp and other stringent restrictions for agricultural goods, she said.

Shrimp exports have been carefully examined by the Fisheries Department and none of the diseases widespread in consuming countries has been recorded, she added.

The government will file a complaint with the World Trade Organisation (WTO) about Australia's pending unfair trade practice against imported shrimp and other agricultural products, Chutima said.

On Vietnam's successful effort to become the 150th member of the WTO, Chutima said the country could beat Thailand as a target for foreign direct investment.

Greater participation in international trade will prompt Vietnam to adjust its regulations along international standards. It then should be able to increase confidence among foreign investors in the country, she said.

Vietnam has many advantages to draw investors, including low labour costs and rich natural resources.

Vietnam's accession to the WTO will both help and hinder Thai firms, she said.

For instance, some may lose export markets to Vietnam as the two countries produce similar goods.

However, many Thai companies are also investing in various industries in Vietnam, and they should benefit from Vietnam being a member of the WTO, she added.

Petchanet Pratruangkrai

 The Nation