Thai auto industry to stay competitive post AFTA<\/p>\n
Agence France-Presse, Bangkok<\/p>\n
Thailand's auto industry will remain competitive despite a
\nSoutheast Asian free trade plan that will virtually eliminate
\ntariffs in the region, Industry Minister Suriya Jungrungreangkit
\nsaid Monday.<\/p>\n
The local automotive industry would benefit from tax reforms
\ndue to bring Thailand in line with the ASEAN Free Trade Area
\n(AFTA) from the beginning of next year, Suriya said in a report.<\/p>\n
"Automobiles assembled locally for domestic and export markets
\nwill still be able to compete against the same vehicle models
\nproduced in other ASEAN countries, even after the import duty on
\nfinished vehicles is reduced to zero to five percent from 30-80
\npercent at present," the minister was quoted by The Nation as
\nsaying.<\/p>\n
Under the Association of Southeast Asian Nations (ASEAN) plan,
\nmost members must cut tariffs on imports for agreed products to a
\nmaximum of five percent by next year.<\/p>\n
The local automobile industry would not be damaged by the
\nlower import taxes on finished cars because the duty on some
\ncompletely knocked down (CKD) parts would also be cut to zero to
\nfive percent from 20-33 percent, an official from the government
\nworking committee responsible for the tax restructuring
\nreportedly said.<\/p>\n
To offset the lower CKD duty, the excise tax on cars would be
\nincreased from the present three to 41 percent, Suriya told the
\nnewspaper.<\/p>\n
However, the reduction of CKD tariffs would be on a selective
\nbasis so as not to damage the local auto-parts industry, the
\nofficial said.<\/p>\n
"For parts we cannot produce here, the import tariff will be
\ncut to zero. But for parts we are capable of manufacturing, the
\nduty will remain as a protective measure," the official was
\nquoted as saying.<\/p>\n
"The idea is to have a flexible tariff regime where a tax can
\nbe changed quickly to respond to changing circumstances."<\/p>\n
Suriya said Thailand would not lose its competitiveness due to
\nAFTA as some critics have claimed, the paper reported.<\/p>\n
Instead, some auto companies would gain as the country has a
\nstrong auto-parts industry compared to other ASEAN countries, he
\nsaid.<\/p>\n
"Companies which might have problems may be ones that have
\nvery low volume production and need to import a lot of parts.
\nThese are the firms who have expressed concern," the paper quoted
\nthe minister as saying.<\/p>\n
ASEAN groups Brunei, Cambodia, Indonesia, Laos, Malaysia,
\nMyanmar, Philippines, Singapore, Thailand and Vietnam.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/thai-auto-industry-to-stay-competitive-post-afta-1447893297",
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"sponsor": "Okusi Associates",
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