AEC could learn lessons from EU: DHL

Thomas Tieber, CEO for South Asia of DHL Global Forwarding (Thailand), said last week that on issues concerning the AEC, Thailand needs to further harmonise procedures, rules and standards with Asean countries especially in terms of customs, administration and transportation.
“Not only talking about air or ocean freight, you will also have to talk for example about cross-border trucking from Singapore up to Malaysia and Burma, or further to Vietnam and China,” he said.
Some key lessons for the AEC are extremely similar to those the EU has learned. The EU has many different countries and different standards while the AEC has Singapore, which is very developed, and Burma, which is developing.
“If they are part of Asean they need to comply with the implementation schedule as only one country cannot win. The AEC is the fastest-growing area in Asia and is also in between India and China. You have to consider that,” he said.
Everybody is looking forward to the 2015 implementation of the AEC in terms of reduced trade barriers.
“I find it’s very interesting that you are in between China and India. Many people talk about only China and India, but nobody talks about the countries in between. The AEC is blocked in and Asean has benefits from that position,” he said.
The AEC’s move is very similar to the EU, from which some key lessons are positive. The EU market is now improving, as competition leads to better services and reduced costs.
“We see Asean as a very important area and the fastest growing in the world. Now Asean’s intra-trade of only 25 per cent can increase to 50-60 per cent in the near future,” he said.
It has huge potential while intra-trade in the EU and North American Free Trade Agreement now account for 60 per cent and 40 per cent, respectively.
Logistics is a key ingredient in integrating trade and business. DHL’s footprint in Asean is very large and growing. Intra-Asean trade is expected to grow to 50-60 per cent by 2015 and shipments could grow in the same way.
Thailand could be a hub of logistics in the region. DHL has been convinced of that since 1993, he said. Simplifying procedures, common standards within Asean, common documentation and common laws in transportation are the basics that Thailand needs to do to become the regional hub.
“Thailand’s geographical location is very good for becoming a hub and Suvarnabhumi is a very nice airport for cargo shipments. Thailand also has three interesting neighbours – Burma, Laos and Cambodia – while China is not far away and it could be attractive. Thailand should not look too far and should look around the western part of China,” he said.
The Dawei Deep Sea Port is an interesting project, which is key for Burma to be further developed. This opens up new routes that help reduce the time and cost of transport. It could save a week from Bangkok to the EU instead of shipping from Bangkok to the EU via Laem Chabang Port and then Singapore.
“DHL has a very large footprint in Asean with one system, one standard and one brand that it needs to keep following. It has about 17,000 staff and 2 million square metres of warehouses across the region,” he said.
DHL utilises 400 flights per week, both its own and other flights. DHL in Thailand is one of the biggest operations in Asean countries. It has a trucking network called Asean Connect running from Singapore to Malaysia, Thailand, Vietnam and Laos.
“We are positive and expect to post a double-digit gain in 2012 in the forwarding business in Thailand,” he said.