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FRIDAY, September 29, 2023

Thai exporters urged to look for opportunities in new green trade rules

Thai exporters urged to look for opportunities in new green trade rules
THURSDAY, June 08, 2023

New global trade rules to reduce climate change could create an opportunity for Thai entrepreneurs to align themselves with global trends, a senior Commerce Ministry official told a seminar in Bangkok on Wednesday.

Environmental trade regulations now play an important role in global trade due to the impact of climate change, but Thai entrepreneurs should not panic or fear these regulations because the Commerce Ministry and related agencies are ready to help them deal with the new rules, said the ministry’s permanent secretary, Keerati Rushchano.

The main danger of impending environmental regulations on trade for Thai exporters is denying their reality, he told the seminar "Innovation Keeping the World" organised by Nation Group at the Eastin Grand Hotel Phayathai.

He said many jurisdictions are implementing environmental trade regulations, such as the European Union (EU), the United States, and Australia.

The EU's Carbon Border Adjustment Mechanism (CBAM), which will collect tax on carbon-intensive imports from January 1, 2026, is an opportunity for Thailand, Keerati said.

CBAM taxes will initially apply to six products: Aluminium, cement, iron and steel, electricity, fertilisers, and hydrogen.

"We should comply with the CBAM because trade competition is high and we are an exporting country ... Thai entrepreneurs will be able to adjust even though it could result in rising costs,” Keerati said.

He said Thai entrepreneurs can prepare themselves for environmental trade regulations by:

1. Using innovations and technologies in production that meet new global trade rules.

2. Preparing data, such as carbon footprint evaluations, material origins and operation traceability, which will show compliance with new environmental rules.

3. Using their alignment with new environmental rules to attract new consumers.

Although exports have been falling, he said they will rise in the second half of this year.

In the first four months of this year, Thai exports totalled 3.21 trillion baht (US$92 billion), down 5.2% year on year, according to official figures. In April they totalled 758.22 billion baht, down 7.6% year on year, according to official figures.

Keerati said exports of Thai agricultural products, led by fruits, rose at an annualised rate of 23% in the first four months of this year, while exports of industrial products fell 11.2% during the same period.