Fix redundancies before aec kicks in, private sector urges
The government has been urged to clear away regulatory redundancy including double-taxation rules before the Asean Economic Community takes full effect, to support Thai companies' regional expansion.
At a brainstorming session with Deputy Prime Minister Kittiratt Na-Ranong yesterday on preparing for the AEC, key private-sector organisations also pushed for the provision of financial services in Myanmar, while noting that Thailand’s service sector should prepare for greater competition.
Payungsak Chartsutipol, chairman of the Federation of Thai Industries, said the discussion focused on the impacts of the AEC on each industry and strategies to accommodate associated challenges.
Aside from the FTI, representatives of the Board of Trade, the Thai Bankers Association, the Tourism Council of Thailand, and the Federation of Thai Capital Market Associations attended the meeting.
"To accommodate changes associated with the opening up [of the region], things need to be changed, particularly regulatory redundancy involving licensing, customs procedures and double taxation," Payungsak said.
He noted that the private sector’s suggestions were warmly welcomed, particularly on the double-taxation issue. It was suggested that companies with overseas investments that pay taxes in the host countries should be exempted from taxes in Thailand.
Kittiratt was quoted as saying that he would negotiate with neighbouring countries over opening of bank branches, which would facilitate lending to Thai overseas investment projects. Myanmar in particular allows only representative offices of foreign banks, not full-fledged branches.
"We agreed that each association should work out proposals in detail and resubmit them, with clarity on what they want. Another workshop will be held in mid-September, chaired by Prime Minister Yingluck Shinawatra," Payungsak said. "We will then come to a conclusion on transport linkages, overseas investment, and hindrances to the AEC.
"Once the community is activated, Thailand will need to work harder on preparing human resources both in the Kingdom and overseas to promote investment and avoid negative responses from host countries."
The government was urged to focus first on training for the hospitality sector, as soon workers will need to meet Asean standards. Thai workers have many advantages, but their biggest disadvantage is language skills. Aside from English, knowledge of Malay, which is spoken by more than 300 million people in the region, is also seen as important.
