Thailand lauds WTO pact on IT
NAIROBI: Thailand is hopeful that trade and investment in the electronics business will flourish after the signing of the information technology pact by the World Trade Organization.
The Information Technology Agreement (ITA) was concluded at the WTO conference in Nairobi late on Wednesday.
Commerce vice-minister Winichai Chaemchaeng said the landmark deal would be a boon to global trade and investment in IT, and member countries including Thailand expected to reap its benefits.
“Thailand already has competency in this business and has become the world’s supply chain for IT products,” he said. “The government itself is now revving up the super cluster policy and digital economy development.”
Super clusters are designated investment centres for high-tech industries. Super clusters will cover six industrial clusters — automotive; food processing; environmentally-friendly petrochemicals and chemicals; medical services; digital; and electronics, electrical appliances and telecommunications equipment.
The cabinet in September approved placing the super clusters in nine provinces.
The food processing, medical services and digital super clusters will be located in Chiang Mai and Phuket, while the automotive, petrochemicals and chemicals, and electronics, electrical appliances and telecommunications equipment super clusters will be located in seven other provinces.
Industries in super clusters will be entitled to full corporate income tax exemption for eight years and a 50% reduction for five years thereafter.
At least 53 WTO members representing major exporters of IT products have agreed on the timetable for implementing the deal to eliminate tariffs on 201 IT products valued at over US$1.3 trillion per year.
The negotiations involved 53 WTO members, including both developed and developing countries, which account for 90% of world trade in IT products.
The breakthrough follows months of i ntensive negotiations among the ITA participants.
The deal included China and the US, which have delayed its conclusion for the past 18 years.
All 162 WTO members will benefit from the agreement, as they will all enjoy dutyfree access to the markets of the members eliminating tariffs on IT products.
The list of 201 products was originally agreed by the ITA participants in July 2015.
Eliminating tariffs on trade of this magnitude will have a huge impact as it will support lower prices, including in many other sectors that use IT products as inputs, as well as help create jobs and it will help to boost GDP growth around the world.
As a result of these negotiations, 65% of tariff lines will be fully eliminated by July, 1 2016.
Most of the remaining tariff lines will be completely phased out in four stages over three years.
Among the products covered by the agreement are new-generation semiconductors, GPS navigation systems, medical products including magnetic resonance imaging machines, machine tools for manufacturing printed circuits, telecommunications satellites and touch screens.
The agreement also contains a commitment to work on tackling non-tariff barriers in the IT sector, and to keep the list of products covered under review to determine whether further expansion may be needed to reflect future technological developments.
The agreement is an expansion of the 1996 Information Technology Agreement, which involved 82 members.
In 2012, members recognised that technological innovation had advanced to such an extent that many new categories of IT products were not covered by the existing agreement.