Thailand to flourish as logistics hub under AEC

The coming Association of Southeast Asian Nations (ASEAN) Economic Community (AEC) will strengthen Thailand’s position as a key transport hub for the Greater Mekong Subregion (GMS), according to a study by Solidiance, a business-to-business consultancy.


Thailand to flourish as logistics hub under AEC


The coming Association of Southeast Asian Nations (ASEAN) Economic Community (AEC) will strengthen Thailand’s position as a key transport hub for the Greater Mekong Subregion (GMS), according to a study by Solidiance, a business-to-business consultancy.

Citing the study, ‘Thailand’s Logistic Opportunities in the Cross-Border Trades and AEC Development’, Solidiance country manager Mickael Feige said the AEC would significantly increase the Kingdom’s trade with its four immediate neighbours – Myanmar, Malaysia, Laos, and Cambodia – as well as, nearby countries such as China and Vietnam.

There will be more opportunities for trade with Myanmar and Cambodia as import tariffs on more than 90 per cent of products in their AEC ‘inclusion lists’ have to be brought down to zero. Already, Thailand has benefited from the gradual reduction of import duty for products shipped to Cambodia, Laos, Myanmar and Vietnam, such as non-alcoholic drinks, motorcycles, tyres, soap, and cleaning products.

Thailand’s cross-border trade with Myanmar, Laos and Cambodia, which respectively accounted for 20, 14 and nine per cent of the total in 2012, is expected to reach unprecedented levels in the next few years, with a growth rate of nearly 30 per cent, Solidiance says. As such, Feige said Thai logistics operators should take this opportunity to expand their business into neighbouring countries as the AEC’s liberalisation of the logistics sector will benefit Thai and other Asean investors.