Thursday, September 11, 2008

Thailand commits to liberalising logistics sector

NAREERAT WIRIYAPONG

Thailand will move ahead with liberalising the logistics sector, under an Association of Southeast Asian Nations (Asean) framework, to turn the kingdom into a regional logistics hub, the Commerce Ministry said yesterday. While acknowledging a potential impact for local operators, permanent secretary Siriphol Yodmuangcharoen said Thailand stood to gain by opening the logistics sector.

''Asean is aiming to become a single market by 2015 and logistics is key to achieving that goal,'' Mr Siriphol said at opening of the Thailand International Logistics Fair 2008.

Under the Asean Economic Community (AEC) plan, Thailand is set to raise its 49% ceiling on foreign ownership of logistics service operators to 51% in 2011 then to 70% in 2013.

Logistics is among 12 priority areas for Asean integration, along with sectors such as automobiles, electronics, agro-based products, fisheries, air travel, tourism, textiles and clothing, and health care.

''After discussion with the private sector, we agree that Thailand is poised to reap benefits from higher regional trade under the AEC if logistics is liberalised,'' said Mr Siriphol.

Chackrit Duangphastra, director of the Service and Investment Negotiations Bureau, said Asean aims to strengthen economic integration through liberalisation and facilitation measures in logistics services by 2020.

Singapore, Laos and Cambodia already allow 100% foreign ownership of logistics-related business. Thailand allows foreigners to hold 100% only of freight service providers, but this is subject to the ministry's approval on a case-by-case basis, he said.

Mr Siriphol added that Thailand has the potential to become a regional logistics hub given the development of more transport routes.

''Our vision is for Thailand to emerge as a country with logistics entrepreneurs and infrastructure of an international standard,'' he said.

''Then, we would be ready to take over the status of the trade and investment hub in Asean, Indochina and southern China. One of the key strategies is to establish a strong logistics and distribution network between countries in these regions.''

To achieve this target, the private sector has argued that Thailand needs to simplify customs procedures for cross-border trade with its neighbours.

''Single-stop or single-window [services] for cross-border trade require urgent solutions, particularly in harmonisation and documentation for customs, quarantine and immigration,'' said Tanit Sorat, vice-chairman of the Federation of Thai Industries (FTI) and head of its Logistics Industry Club.

But he added that Thailand's seaports and airports and its land transport gave it a competitive edge on its neighbours.

''Malaysia and Singapore have fewer prospects of becoming a hub than Thailand as Singapore's land transport has to pass through Thailand to link up with countries in Indochina and the Mekong region,'' he said.

''Therefore, Thailand has the opportunity and possibility of rising as a logistics hub among the Indochina and South China countries.''

The logistics fair is being held until tomorrow at the Bangkok International Trade and Exhibition Centre. It features exhibitors from Asean countries, China, Taiwan, Japan and Germany and is expected to attract more than 10,000 trade visitors from Thailand and overseas.

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