UPS pushes end to Asean trade barriers

UPS pushes end to Asean trade barriers

Firm eyes regional cross-border traffic

Mr O'Gara says the removal of remaining trade barriers in the region would boost economic growth and UPS would be happy to be involved in discussions supporting the free movement of goods across countries.
Mr O'Gara says the removal of remaining trade barriers in the region would boost economic growth and UPS would be happy to be involved in discussions supporting the free movement of goods across countries.

United Parcel Service (UPS) is calling for removal of trade restrictions among Asean countries to boost economic growth in the region.

The global logistics provider is also urging Thai companies to take advantage of the easing of US customs policy.

Jim O'Gara, president for South Asia at UPS Asia-Pacific, said the region is one of the company's growing markets with a high volume of business activities it could tap.

UPS has operations in all 10 Asean member countries and sees great opportunities to offer services to facilitate trade in the region and also cross-border trade that has increased substantially in recent years.

"China, which was deemed to be the powerhouse in the past, has started to move some of its businesses into Southeast Asia to capture the talent in those countries," said Mr O'Gara.

He said the increase in spending of the middle class throughout the region would be a major factor to support growth.

On the other hand, growth is expected to be limited in some countries that have tight restrictions on cross-border trade such as high tariffs or complicated customs procedures.

When goods are traded across the border, transport costs account for 40-50% of total costs, mainly because of high tariffs, Mr O'Gara said.

"The growth of these countries can increase as those restrictions are adjusted or removed and that will also support the growth in the region as a whole," he said.

By removing those restrictions, all goods will be allowed be trade freely, smoothly and quickly in order to reach the right market without delays or additional expenses.

Mr O'Gara said consumers would also benefit from lower prices of goods due to the removal of tariffs.

After the launch of the Asean Economic Community, UPS sees willingness in several countries to engage in talks regarding free trade agreements both within and outside the region.

"We welcome any chance to be involved in discussions that will support the free movement of goods across countries," said Mr O'Gara.

He said UPS also supported Thai businesses exporting more to other countries as a way to cope with the sluggish domestic economic outlook.

Mr O'Gara said UPS had set up workshops for Thai small and medium-sized enterprises to educate and encourage SMEs to trade more via border trade and to look at other countries beyond Asean, including the US.

A recent change in US customs policy allows people to export more to the US without paying high tariffs.

On Feb 24, President Barack Obama signed a new bill to increase the US de minimis level on international shipments to the US from $200 per shipment to $800. De minimis value is a minimum dollar value of goods that have to undergo formal customs procedures and also require the collection of duties or taxes. The law, which took effect on March 10, benefits importers and exporters by reducing customs procedures and duties or taxes.

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