Thai garment manufacturers must explore more export markets, focusing on Asian countries. These markets will boost their imports when the EU and the US are scheduled to end textile safeguard measures against Chinese products early next year and in 2009, respectively.

The US is Thailand's biggest market for garments, with an export value of US$1.78 billion (Bt62.92 billion) last year, followed by the EU with $965.14 million. Japan ranked third with $218.1 million.

Jtepa's tariff exemption will create more export opportunities and strengthen the Kingdom's competitiveness against cheaper-priced goods from China.

Japan imports garment mainly from the US, which quotes expensive prices. Hence, the country is looking for new exporters that offer lower prices than the US, Santi said.

"Jtepa will create a win-win benefit for manufacturers and consumers of the two countries," he noted.

In addition, Japan has great potential to become a major food-export market for Thailand. Santi said the Thai service sector, especially restaurants, would also have good export opportunities.

Santi pointed Jtepa would not affect the Kingdom's automotive industry severely, because the government had not agreed upon a zero tariff. Under the agreement, import duty for cars with engines sized more than 3,000cc will be cut from 80 per cent to 60 per cent in the next four years. However, smaller-engine-sized cars have not been included.

Meanwhile, Industry Ministry permanent secretary Chakramon Phasukavanich said Jtepa would also encourage Thai agro-industrial producers to export their products to Japan. So far, Japan has banned certain Thai agro-products.

Chakramon said the agreement would attract Japanese automotive companies to turn Thailand into its integrated

car and auto-parts production hub.

However, local industries must speed up producing more skilled labour and adopting more advanced technologies.

The public has expressed concern, however, that Jtepa will pave the way for Japan to dump industrial waste in Thailand.

Santi explained that the agreement mandated that industrial-waste importers inform the relevant authorities as to the purpose of the imports and outline plans for their use.

He added that Thailand also had laws to ban imported toxic waste. "If Jtepa looked set to cause a toxic-waste influx into the country, we would absolutely object to this agreement," he said.

Chalida  Ekvitthayavechnukul

The Nation