Carmakers granted waiver on components
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Thai carmakers will enjoy higher benefits under the Japan-Thailand Economic Partnership Agreement (Jtepa) as tariffs for 140 auto parts imported from Japan have been waived to support the growth of the local industry after the severe flooding last year.
The agreement is retroactive to April 1 this year.
Srirat Rastapana, director-general of the Commerce Ministry’s Trade Negotiations Department, said the waiver would speed up the recovery of Thai carmakers.
Previously, average import tariffs for auto parts were 10-20 per cent, but now tariffs for most of these products will be cut to zero immediately, while levies for some will be gradually brought down to zero by 2014.
“Local car producers will be able to save significant costs and improve their competitive edge because of the lower tariffs for many parts. Also, imported parts from Japan are of high quality, which will help promote growth of the industry,” Srirat said.
According to the department, Japan has been Thailand’s major source of car components for the past three years. Auto parts imported from Japan were worth US$5.86 billion (Bt186 billion) last year, or 63 per cent of the total value of imports of such products.
Thailand relies heavily on Japanese components because Japan is the Kingdom’s largest source of investment in car manufacturing. Accumulated investment from Japan from 2003 to 2011 was worth $36 billion, or 24 per cent of the Japanese automotive industry’s total overseas investment in Asia.
