Japan-Thai Free Trade Pact Takes Effect in Nov.

97% of Japanese exports to Thailand and 92% of Thai exports to Japan will be tariff-free within 10 years

Tearing down most tariffs between the two trading partners, Japan's free trade pact with Thailand will take effect on November 1, the government said Oct. 2. The controversial deal was inked in April after months of uncertainty due to Japan's uneasiness over the military coup and street protests in Bangkok.

Under the agreement, about 97% of Japanese exports to Thailand and 92% of Thai exports to Japan will be tariff-free within 10 years.

Activists in Thailand have also expressed fears that the free-trade deal will turn their country into a dumping ground for Japan's toxic waste.

Japan, Thailand's largest investor, will scrap tariffs on Thai shrimp and tropical fruit such as mangoes and durian, although it will keep protecting Japan's politically powerful rice farmers. Thailand will cut tariffs on automobiles with engines of 3000 cc or larger to 60% from 80% over four years and eventually scrap all tariffs on steel imports. Thailand has become a major construction hub for Japanese automakers.

For its part Japan, the world's second largest economy, has been seeking a growing number of bilateral free-trade deals amid the breakdown in global liberalization talks. It has inked trade pacts with other countries including Malaysia, Singapore and the Philippines.

Copyright Agence France-Presse, 2007

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