The cabinet yesterday approved the Asean-Hong Kong Free Trade Area (AHKFTA) agreement, with the official signing scheduled for the 31st Asean Summit on Nov 12 in Manila.
Kobsak: Deal to enhance trade
Kobsak Phutrakul, assistant minister to the Prime Minister's Office, said the government is hopeful the AHKFTA pact will deepen cooperation on tariff reduction and other areas between Asean and Hong Kong.
"Hong Kong is receptive to Thailand as the centre of Asean," he said. "We all hope the AHKFTA will help enhance trade and investment between Asean and Hong Kong."
Under the agreement, Asean will use Hong Kong for goods distribution to China as Hong Kong signed the Closer Economic Partnership agreement with China, under which 1,819 items exported from Hong Kong enjoy no tariffs.
The agreement allows Asean a greater opportunity to lift service standards, while Hong Kong will support expert workers from Asean, especially for finance, logistics and legal services.
Asean will also be entitled to have more access to financial sources in Hong Kong.
Hong Kong will benefit from the lower tariffs afforded to Asean members.
Mr Kobsak said the agreement calls for Thailand to eliminate tariffs within three years on 6,364 categories, with another 1,750 categories of tariffs eliminated within 10 years.
Some 435 categories of sensitive items are required to have tariffs cut to 0-5% within 12 years, and 650 categories of very sensitive items are required to reduce tariffs by 50% within 14 years.
Hong Kong is Thailand's eighth-largest trading partner. In 2016, trade between the two was US$13 billion (431 billion baht) while the Board of Investment approved 32 projects from Hong Kong investors worth 8.6 billion baht.
In the first eight months this year, trade between Thailand and Hong Kong was $11 billion, up 16% from 2016.
Yesterday the cabinet also approved a plan to establish a Hong Kong trade office in Thailand.
