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Published on September 28, 2007

Their concerns were expressed during a seminar entitled "Japan-Thailand: The Strategic Economic Partner under Jtepa" in Tokyo yesterday. Thailand's Commerce Ministry is conducting a two-day roadshow to promote trade and investment in Thailand before the implementation of Japan-Thailand Economic Partnership Agreement (Jtepa) on November 1.

Commerce Minister Krirk-krai Jirapaet said Japanese businessmen were worried about four key issues: the import of automotive goods, customs procedures, new investment and reinvestment and the amended Foreign Business Act's restrictions against foreign shareholders.

"They [Japanese businessmen] are uncomfortable [in the belief that] the FBA amendments will draw investment barriers to them. However, the chairman of the Thailand's Board of Trade has explained that the amended law is aimed mostly at creating good governance in the country," Krirk-krai said.

Attending the seminar were executives of some of Thailand's key trade-related bodies.

Krirk-krai said the ministry wanted Japanese businessmen to hear directly from the top executives in Thailand's trade, investment and policy environments. Information from key private-sector organisations should convince them to consider increasing their investment in Thailand through the bilateral free-trade pact.

However, a Japanese businessman who earlier worked for Toyota in Thailand suggested the Kingdom focus on human-resource development to support its manufacturers.

For their part, Japanese interests should concentrate more on technology transfer instead of acting act solely as managers. They should be "more localised".

Krirk-krai said Japanese businessmen were also concerned that the strength of the baht would reduce the competitiveness of Thai goods. However, he reversed the situation by saying the country could not keep the baht weak all of the time. The currency's strength has supported imports of capital goods and raw materials, and it will strengthen Thailand's export competitiveness in the long run.

Thai Garment Manufacturers' Association president Dej Pathanasethpong said Jtepa was expected to increase the value of the industry's exports to Japan 25 per cent next year. At present, that value stands at US$300 million (Bt10.27 billion) per year despite the fact that Thai apparel has only a 2-per-cent share of a Japanese market dominated by Chinese products, which enjoy a 90-per-cent share.

Thai Frozen Foods Association president Poj Aramwattananont said Japan wanted Thailand to become a supply base for safe foods and that Jtepa would create benefits for both countries from shrimp, tuna, chicken, fresh-fruit and vegetable exports.

Under the agreement, import tariffs on Thai shrimp will be eliminated. The proportion of Thai shrimp exports going to Japan is expected to rise from 20 per cent now to 30-35 per cent of total export production, valued at $2 billion last year.

Achara Pongvutitham

The Nation

Tokyo