South Korea interested in setting up EV production base in Thailand
South Korea is seeking to secure an economic partnership agreement with Thailand to reduce import-export taxes and establish an electric vehicle production base in Thailand, Trade Representative Nalinee Taveesin, has revealed.
Nalinee was recently in Seoul for talks with Ahn Duk-geun, South Korea’s Minister of Trade, Energy and Industry, who expressed interest in negotiating an Economic Partnership Agreement (EPA) between the two countries. Currently, the two nations have only regional trade agreements such as the ASEAN-Korea FTA (AKFTA) and the RCEP, and have yet to sign a Free Trade Agreement (FTA).
The ROK’s Trade Minister also met with Thailand’s Commerce Minister during the APEC meeting in San Francisco and will be holding further discussions with his government on his return. The successful implementation of an EPA would significantly reduce import-export taxes and trade barriers while promoting supply chain integration and goods movement, especially in the automotive industry, which holds potential for both Thailand and South Korea.
Moreover, Hyundai and Kia are currently expanding their businesses and planning to establish electric vehicle production bases in Thailand. South Korea has proposed leveraging EPA negotiations to prepare the private sector. Nalinee confirmed that Thailand is prepared to collaborate with South Korea in outlining the terms of reference (TOR) to swiftly develop the EPA.
South Korea has previously invested in ASEAN members but faced obstacles in some nations due to inadequate public infrastructure and energy. Despite significant investment benefits, South Korea's major industries require considerable energy for production.
Nalinee noted that South Korea recognises Thailand’s readiness and is considering distributing investments to reduce reliance on any single country.
Thailand, for its part, is encouraging South Korea to invest, pointing to the benefits it would receive from the Board of Investment (BOI), the Eastern Economic Corridor (EEC) and other projects, as well as Thailand’s position as a gateway to markets in Southeast Asia, Central Asia, and Europe.
Thailand boasts a skilled workforce and annually attracts around 40,000 students interested in learning the Korean language, ranking first outside South Korea in Korean language learners. She believes this negotiation is an excellent sign of cooperation, coinciding with the 65th anniversary of the establishment of diplomatic relations between Thailand and South Korea this year.