Thailand aims to clinch deals to form deeper trade partnerships through “mini-FTAs” with Hainan, China and Telangana, India by August after the country on Monday inked a memorandum of understanding (MoU) to form a mini free trade agreement (mini-FTA) with Kofu city in central Japan.
Commerce Minister Jurin Laksanawisit, who presided over the MoU signing on Monday, said the government is also pursuing similar mini-FTAs with other places including Gyeonggi province in South Korea.
“We are accelerating this partnership process with other states, as mini-FTA plans are a key policy the ministry is pursuing to boost trade, investment and economic cooperation,” he said.
According to Mr Jurin, the deeper trade partnerships at the city or state level will help boost trade and investment in targeted industries.
Kofu is a regional commercial and transport hub for the central Yamanashi prefecture.
Local industries include gems and jewellery, food processing including wine production, textiles and crystalware.
Yamanashi was originally famous for quartz crystal jewellery production and over the centuries became the leading region in Japan for gemstone and precious metal processing.
Around 30% of Japan’s carved jewellery is produced in the prefecture, making Yamanashi not only Japan’s No.1 jewellery region but also one of the most famed hubs in the world.
“The MoU signing with Kofu city is expected to bring about several mutual benefits to Thailand and Japan, whether it involves manufacturing, joint marketing or technology transfers,” said Mr Jurin.
“This deeper cooperation is estimated to increase the trade value in gems and jewellery between Thailand and Japan by 5% to not less than 15.5 billion baht this year.”
The trade partnership with Kofu is the first mini trade agreement for the Thai government.
A similar pact with Telangana state in India was scheduled to take place in January this year but was postponed.
Two-way trade between Thailand and Japan tallied US$50.5 billion last year, with exports from Thailand accounting for $22.8 billion and imports worth $27.7 billion.
Thailand posted a trade deficit of $4.87 billion with Japan last year.
In the first five months this year, two-way trade reached $24.9 billion, up 16% from the same period of last year.
Exports from Thailand made up $10.4 billion, up 9.21%, while imports were worth $14.5 billion, up 21.5%.
Thailand had a trade deficit of $4.12 billion with Japan in the first five months this year.
The government has set a target to raise exports to Japan by 4% to $23.35 billion this year.