CHIANGRAI TIMES – Thailand is planning a major pitch to open free trade talks with Canada this week, as Prime Minister Stephen Harper begins his second Asia trip in three months.
Thailand will sweeten its offer by positioning itself as a comfortable and safe entry point from which Canada could make further inroads throughout South Asia — raising the potential of a broader trade deal with the region’s emerging, 10-country bloc, the Association of Southeast Asian Nations (ASEAN).
China is not an ASEAN member, so any economic gains with the bloc would represent a significant broadening of the Harper government’s pro-Asia trade aspirations.
Harper, who made his second trip to China in January, has said increasing trade with Asia is a major economic priority after a series of economic hurdles soured relations with Canada’s largest trading partner, the United States.
“It’s understandable that Canada has to diversify and be less dependent on the U.S. market. We welcome the realization,” Srirat Rastapana, director general of Thailand’s Department of Trade Negotiations, told The Canadian Press in an interview.
“This year would be an important year that we can lay the foundation for a stronger relationship with Canada. We welcome Canada’s participation in ASEAN forums. We think Canada could be an invaluable partner for ASEAN.”
Srirat said Canada and Thailand will explore how to promote and enhance trade and investment.
“We (will) also touch on the possibility of preparing a kind of a joint study, scoping for the free-trade agreement,” she said.
Earlier this month, Canada and Japan released their own joint study on the possibility of a trade agreement that concluded “there remains much untapped potential” in their relationship.
The study predicted that a trade deal would lead to gains in gross domestic product of $4.4 billion to $4.9 billion for Japan and between $3.8 billion to $9 billion for Canada.
Harper will travel to Japan after his stop in Thailand, before finishing his three-country tour in South Korea.
Canada has modest trade with Thailand, with exports of $839 million and imports of $2.7 billion in 2011.
Srirat said there is potential for greater co-operation in energy, food and green technology.
Last fall, Canada and ASEAN signed a joint declaration that pledged to promote trade and investment.
In a wide-ranging interview from Bangkok’s trade ministry, Srirat said doing business with Thailand would open doors for Canada with other ASEAN countries. Thailand, she said, can also help Canada make progress with China and India.
“We can be a gateway, we can be partners,” she said. “We can work with other countries, the emerging markets in Asia. Thailand has several free trade agreements at the level of ASEAN. Now we are in the process of concluding our negotiations with India.”
ASEAN leaders are committed to establishing an economic community by 2015 that would allow for a freer movement of goods, services, labour and capital among member countries.
Srirat said Canada has a lot of catching up to do in the region, and Thailand could help.
“Canada, could in fact, be the latecomer because your private sector has to adjust to the new environment, which is more complicated,” she said.
“Getting to know the environment and the culture is the basic for any business to start in a new country or region.”
Unfamiliar laws and cultural practices make setting up shop in the region a challenging experience, said Toronto-born John Casella, president of the Thai-Canada Chamber of Commerce.
“Thailand is actually an easier place to do business once you’ve got through the learning curve of getting through the Thai bureaucracy,” Casella, an accountant and tax consultant, said in an interview.
“Canadians are a little bit more naive to certain things. Things that might be taken for granted in terms of how the courts might work, or how commercial practices are, I think leave Canadians at a disadvantage.”
An investment now could pay off later for Canadian companies, said Casella, because huge growth is predicted for ASEAN in the coming decade.
“Stephen Harper has expressed more interest in doing business with Asia. It’s well long overdue,” said Casella. “As a Canadian living in this part of the world, I’m excited that Canada is starting to wake up to that fact.
“There are very good opportunities for Canadians, because they are well received in this part of the world, more so than some other countries.
“Our neighbours to the south do not always make the best friends in terms of the ease of doing business.”
Harper was supposed to visit Thailand last fall, but his trip was cancelled due to severe flooding in the country.
Casella said he hopes Harper’s trip helps raise Asia’s profile in Canada as a business destination, because that is sorely needed.
He pointed to a poll last year by the Asia Pacific Foundation of Canada that showed ambivalence towards the region. Only 26 per cent of respondents agreed that Canada was part of the Asia-Pacific region, compared with 30 per cent in 2008.
“With the way that the economy is going and developments being made here, it’s in Canadians’ best interest to be more aware of opportunities here.”
Jean Chretien led the last official visit by a prime minister to Thailand in 1997, when he brought along a Team Canada trade delegation.
“If the Canadian prime minister waits another 15 years for the next visit, I think some huge opportunities will be lost,” said Casella.