Thailand warned of changes in Japan’s agricultural policies
A senior official in Thailand’s embassy in Tokyo has warned the Kingdom to prepare for the impacts of Japan’s plan to cut around 400 Thai agricultural products from the Generalised System of Preferences (GSP) two years from now.
Choltisak Chawpaknum, minister counsellor in the Office of Agricultural Affairs at the Thai Embassy in Tokyo, said the Japanese Ministry for Agriculture, Forestry and Fisheries had decided to bring its agricultural policies more into line with domestic consumption behaviour and institute reforms to improve domestic agricultural productivity.
Japan is a big market for Thai agricultural products under the Japan-Thailand Economic Partnership Agreement (JTEPA).
“This policy adjustment aims to lessen Japan’s reliance on imported foods and to shift its status from an importer of agricultural products to being an exporter,” Choltisak said.
Japan targets increasing the annual value of its agricultural exports from 450 billion yen (Bt140 billion) now to 1 trillion yen by 2020. It hopes to include Thailand as a destination for these exports, while ensuring that Japanese agricultural products are recognised for high safety standards.
In the meantime, Thai products could have trouble meeting quality standards in the Japanese market.
Thailand-Japan trade totalled Bt1.81 trillion last year, of which agricultural and food products amounted to Bt175.56 billion. Thailand enjoyed an overall trade surplus with Japan. Its agricultural exports to Japan were valued at Bt164.89 billion, while the value of Japan’s agricultural exports to Thailand was Bt10.67 billion.
The Kingdom’s key food and agricultural exports to Japan included processed chicken, rubber, sugar, shrimp and feed meal.
Thailand and Japan recently signed a memorandum of intention under JTEPA to discuss agricultural-policy initiatives and cooperation. Thailand will propose a memorandum of understanding on illegal, unreported, and unregulated (IUU) fishing, the details of which are being prepared.
In preparation for its penetration of the Thai market, Japan hired a research firm to survey and interview Thai executives on the best strategy for exporting its products here. Therefore, Thailand’s agricultural system should be prepared to adopt Japanese procedures for consistent and standardised production capacity and quality, Choltisak said.
After the collapse of the Trans-Pacific Partnership due to the US withdrawal, it is possible for Japan to maintain many of the benefits it had hoped to gain from the pact. There could be negotiations for bilateral agreements on tariff privileges. It is not yet clear how these will affect the country’s agricultural trade with Thailand, but the Kingdom will certainly have to make some adjustments, the official said.
As for Thai agricultural exports currently receiving tax privileges under JTEPA and the Asean-Japan Comprehensive Economic Partnership, 408 products may see GSP cuts by Japan from April 2019 onwards.