Limited FTA impact: report
The South Korea-US free-trade agreement is not expected to have an immense effect on the Thai economy, except for the textile and garment sector which will be affected by the US's lowering of tariffs on Korean imports, according to a Kasikorn Research Centre report.
The research house said the impact on the Thai auto industry would be minimal given its low exports to the US compared to other markets. However, textile and garment exports could cost more than Korean products as a result of the FTA. "Though Thailand's share in the US textile and garment market is 2.5 per cent, higher than the 1.2 per cent of South Korea, the lower tariffs for South Korea would reduce Thailand's competitiveness," the report said. Textiles and garments form the second-largest export item from Thailand to the United States, following computers and computer parts and accessories, with an annual export value of more than US$1.5 billion (Bt52.5 billion). "Thai operators should be prepared for fiercer competition in the US market, aside from competition from cheap products from China, India and other Asian developing countries," Kasikorn Research Centre said. The South Korea-US trade pact, finalised on April 1, is expected to boost bilateral trade value between the US and South Korea to above $100 billion, from last year's $78.29 billion.
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