Pandemic hits trade perk use
Down 15.1% in first 5 months of the year
The use of free trade agreement (FTA) privileges and the Generalized System of Preferences (GSP) by Thai exporters fell by 15.1% year-on-year in the first five months of 2020, moving in line with the country's lower overall exports during the coronavirus pandemic.
The Foreign Trade Department on Tuesday said the use of privileges under FTAs and the GSP by Thai exporters totalled US$26.06 billion between January and May.
The use of FTA privileges contributed $23.98 billion in the first five months, down 15.9% year-on-year, while shipments under the GSP made up $2.08 billion, down 3.5%.
The top five export markets with the most use of FTA privileges were Asean, China, Japan, Australia and India.
The Thai-Asean FTA continued to produce the greatest value, with $8.05 billion in the period, while the Thai-China FTA totalled $7.8 billion. Thai-Japan privileges were worth $2.88 billion.
The Thai-Australia and Thai-India FTAs saw value of $2.44 billion and $1.44 billion, respectively.
Thailand has 11 FTAs in place, excluding the Thailand-New Zealand FTA, which requires self-declaration for proof of origin, and the Asean-Hong Kong FTA under which import tariffs on most of the product items from Thailand were waived before the pact.
According to the Foreign Trade Department, the US retained the highest rate of GSP use, making up $1.9 billion, down 4.2%, followed by Switzerland ($106.36 million, down 2.7%), Russia ($66.45 million, up 12.7%) and Norway ($10.07 million, up 24%).
The GSP is used for trade with the US, Switzerland, Russia and Norway. Japan removed preferential tariffs for Thai products last year.
Products that saw the highest application of GSP privileges were rubber gloves, air-conditioner parts, processed food, fruit and vegetable juices, and electric transformers.
Keerati Rushchano, the department's director-general, said that while the use of trade privileges under the two schemes by Thai exporters had been hit hard by Covid-19, some exports, particularly in drinks and processed foods, were found to remain strong.
"We've seen a robust expansion of the use of privileges, particularly processed foods (the US and Asean), canned pineapple (Russia and the Commonwealth of Independent States), fresh and frozen fillets (Russia and the Commonwealth of Independent States), processed pineapple (Chile), tuna (Peru), and processed tuna and processed tofu (Australia)," he said.
The department plans to hold a seminar in September in Bangkok to educate and promote Thai exporters to make better use of trade privileges under the FTA and GSP schemes. Online broadcasting will be made available for the seminar.