FTA worries some

Some businesses in Malaysia, Thailand and the Philippines have also expressed reservations about wide-ranging tariff cuts on Chinese imports under the FTA. -- PHOTO: REUTERS

Jan 6, 2010
By Lynn Lee, Correspondent
The Straits Times (Singapore)

Their concern: They wil not be able to compete with Chinese imports

JAKARTA - A FREE trade area (FTA) set to boost the flow of goods and investment between Asean and China has triggered calls from Indonesia's businesses for protection from their Chinese competitors, even as consumers cheer its potential to offer more choices and lower prices.

Some businesses in Malaysia, Thailand and the Philippines have also expressed reservations about wide-ranging tariff cuts on Chinese imports under the FTA.

Under pressure from the business community, the Indonesian government is seeking to re-negotiate the deal, which was signed in 2002 and kicked in last Friday.

Under the FTA, China and the six founding Asean countries - Indonesia, Singapore, Thailand, the Philippines, Malaysia and Brunei - must cut tariffs on 90 per cent of imported goods across 7,000 product categories. The group's newest members - Cambodia, Laos, Vietnam and Myanmar - will gradually reduce tariffs and must eliminate them entirely by 2015.

China is now Asean's third-largest commercial partner after Japan and the European Union, with a trade volume of US$230 billion (S$320 billion) in 2008.

In the run-up to Jan 1, Indonesian trade associations - particularly those in the steel and textile businesses - had voiced concern that the FTA would lead to a surge of cheap China imports and put them out of business.

Cambodia to import more salt from China

PHNOM PENH, Oct. 13 (Xinhua) -- Cambodia will spend a further 2.2 million U.S. dollars importing salt from China during the fourth quarter after salt production was cut back this year by excessive bad weather, local media reported on Tuesday, citing the president of the Cambodian Salt Production Association.

The Kingdom has already spent 2.2 million dollars importing 20,000 tonnes from China this year after it became clear in July that local production would not meet annual demand of about 120,000 tonnes, Ly Seng, the president of the Cambodian Salt Production Association, was quoted by the Phnom Penh Post as saying on Sunday.

"We will spend more money to import more salt if local production still cannot meet local consumption demand," he said.

For the local salt industry in Kampot province, 2009 has been a washout due to early rains that mean only about 30,000 tonnes will be produced, compared to a usual capacity of about 180,000 a year that normally produces a surplus for export, Ly Seng said. The Kingdom has 187 salt producers, he added, with 4,400 hectares of salt flats in production.

This is the first year on record that Cambodia has had to import salt.

Srun Thida, a salt retailer at Old Market in the capital, said he was able to sell imported salt from China at the same price as the Cambodian-produced variety: 142 dollars a tonne.

"We have run out of local salt since the middle of the year because our suppliers said their salt production had been affected by rainfall," Srun Thida said.

Ly Seng said the Cambodian Salt Production Association has been selling imported salt to wholesalers at 120 dollars per tonne, about 10 dollars more expensive than the 110 dollars per tonne import price.

Thai air conditioner makers worry about Chinese imports

Aug 29, 2009
DPA

Bangkok - Thailand's manufacturers of air conditioner units have expressed concerns about tough competition from Chinese imports when the China-ASEAN free trade agreement (FTA) cuts tariffs on the item in January, media reports said Saturday.

'This FTA will cause difficulties for domestic sales and exports to neighbouring countries,' Phairat Uechooyos, chairman of the Federation of Thai Industries' Air-Conditioning Club told The Nation newspaper.

Phairat said that Chinese-made air conditioners in some categories sell for about one-third the price of Thai-made units.

China produced about 34 million air conditioners last year compared to 17 million units manufactured in Thailand. Thai A/C exports earned the country 300 billion baht (8.8 billion dollars) in 2008.

The Association of South-East Asian Nations (ASEAN) signed a FTA with China in 2006, immediately removing tariffs on 3,906 items. Another 2,660 items, including air conditioners, will become tariff free in January 2009.

ASEAN includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam, a combined market of about 600 million people.