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Japanese demand better standards

Bangkok Post

Japanese demand better standards

Rules of origin pose another FTA barrier


13 December 2005

Japanese fruit producers and exporters have called for their Thai counterparts to upgrade sanitary and food safety standards if they want to succeed in promoting Thai fruit consumption in Japan.

’’Despite the free trade area (FTA) pact between Thailand and Japan being put in place next year, it is highly likely that Thai fruit and other farm products will fail to fully capitalise on the Japanese market because of Japan’s high food safety and sanitary standard requirements,’’ said Takeshi Kanai, manager of the Agricultural Policy Department of the Central Union of Agricultural Co-operatives.

He made the comment at the second Japan Food Fair 2005, which was held over the weekend at the Queen Sirikit National Convention Center, to open up business opportunities and raise Thai awareness. Fifty-seven Japanese producers and exporters took part in the event.

Japanese exporters and farm producers have high hopes for the bilateral free trade area agreement to boost Japanese food in the Thai market, according to Mr Kanai.

Despite relatively high prices for Japanese produce, Japanese exporters said their products have a lot of potential in the Thai market among middle- to high-end consumers, because their products are high quality in terms of freshness, taste and appearance.

Nobuyuki Tsuzuki, director of the Trade Promotion Department of the Japan External Trade Organisation in Bangkok, said products that had a lot of potential included strawberries, apples, and pears.

Japanese apples are now subject to an import tariff of 10%, which stands at 30% for pears, and 40% for strawberries.

Bangkok and Tokyo reached an FTA in early August, which is expect to be signed in April and implemented by September 2006. But rules of origin issues, whereby a product must be traced through its various processes, need to be addressed.

About 500 farm and fishery products with a combined export value to Japan of 42 billion baht are at issue under rules of origin.

At present, Thailand exports 94 billion baht in farm and fishery goods to Japan, 72 billion baht of which would be covered under the FTA.

Mr Tsuzuki said the FTA was expected to bring about higher investment from Japan, particularly in food industries.

’’Thailand is rich in raw materials for food products, it has competitive prices, labour costs, and convenient transport. It has the potential to be the future production base for high-value food products,’’ he said.

Masanori Ichioka, managing director of Azumino Harvest, said Thai fruit, particularly mangoes and rambutans, had export potential in the Japanese market, but should be better advertised to raise awareness among Japanese consumers.

However, standards are still an issue. One Japanese importer said that consumers there preferred products from organic farms.