Australia is keen on tightening trade ties with Thailand, which will remain as a regional hub for the country in terms of expanding trade and investment and economic cooperation.
"Asean as a region is going to become crucial for Australian business and has the potential to be even bigger than China," Australian Industry Group chief executive Innes Willox told the Australia-Thailand Business Forum yesterday.
He said Thailand had an opportunity to be at the centre of the growing region, where Australian companies can benefit from its long-standing relationship under the Thailand-Australia Free Trade Agreement (Tafta).
Last year, bilateral trade between Thailand and Australia stood at A$16.1 billion (421 billion baht), while Asean ranked as Australia's second-largest trading partner with trade value of A$16 billion.
Thai investments in Australia have grown significantly from A$338 million in 2006 to A$6.1 billion in 2013.
Australian investment in Thailand rose from A$600 million to A$4 billion in the same period.
Australia's main imports from Thailand include automotive, heavy industry and manufacturing products.
But Mr Willox said he saw more opportunities to expand business in the service sector including banking, insurance and manufacturing.
"As Australia is a high-cost economy, Thailand is the perfect market for manufacturing to develop," he said.
However, challenges for Australian companies here are non-tariff barriers and market access.
Mr Willox said the issues were crucial for trade development because the current economic relationship was not as free as it should be.
Australia's senior trade commissioner Greg Wallis said even with tariff reductions under Tafta, Australian products such as meat and dairy items faced non-tariff barriers that hindered their market access.
He also encouraged Thailand to liberalise its service sector because the country has the potential to become more competitive.
Mr Wallis said he expected to see 20% growth in bilateral trade by 2019 from A$16.1 billion last year thanks to regional economic integration.