New ASEAN Rules a Wake Up Call to Thai Farmers
31 August 2010
The impending Asean Economic Community (AEC) is set to liberalize trade and open up competition for the market share of exported agricultural products currently dominated by Thailand. Presently, Thai farmers reap the benefits of a high trade surplus. However, according to the adviser to the agricultural minister, Apichart Pongsrihadulchai, once investment is opened under the AEC, Asean investors will have access to some divisions within the farming industry. Additionally, manufacturers will have a green light to move to countries where they can find lower labor and production costs.
Thailand farmers will need to modify their means of production and adapt to trends that will enable them to produce goods at a lower cost in neighboring countries. Thai enterprises will need to do the same, adjusting their business strategy so they can continue to compete in a market that will soon become borderless. As the global population continues to increase and health concerns rise in tandem, Thai farmers will be facing several new factors that can cause challenges with meeting an increasingly diversified international demand.
Under the AEC, trade partners of Thai farmers can increase non-tariff barriers to shield their own domestic markets, which could lead to new difficulties for Thai exports. Topics covered by the non-tariff barriers include healthcare, food safety and quality, sanitary standards and environmental protection.
As the AEC will be fully enforced within the next four years, Thai farmers and enterprises will need to focus on improving the quality and quantity of their products if Thailand wishes to stay on top in the midst of the new trade liberalization.
Related Articles and Documents:
Thailand Excise Tariff Act
The Liability for Damages Caused by Unsafe Goods Act B.E. 2551
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