Trade with Cambodia will decline at least 20%

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By CHALIDA EKVITTHAYAVECHNUKUL

THE NATION

(Posted by CAAI News Media)

Trade between Thailand and Cambodia will fall at least 20-per-cent short of last year's US$2.13 billion (Bt70.64 billion), due to their roiling political conflict, a new study shows.

"Trade will decline 20 per cent, or roughly Bt14 billion, if the two countries respond to each other only by diplomatic means," Anusorn Tamajai, dean of Rangsit University's Faculty of Economics, said yesterday.

"But if the situation grows more intense until they end up closing the border, the trade loss will rise to 50 per cent. In the most serious scenario, in which the two countries go to war with each other, 90 per cent of the trade will disappear."

The study, "Economic and Investment Impact from the Thai-Cambodian Conflict and Some Solutions", focused on the opinions of Thai social leaders and businessmen.

Over the past two or three years, two-way trade has been growing 10-15 per cent annually, with many Thai companies expanding their investment there, particularly those in labour-intensive industries.

The loss of investment could range from Bt7 billion to Bt32.521 billion, depending on the severity of the situation.

However, it is difficult to evaluate the full loss from this conflict, especially in terms of poorer living standards and lost economic opportunities, he said.

Fifty-two per cent of survey respondents preferred the two governments to solve the conflict diplomatically and return the situation to normal as soon as possible.

Only 2 per cent thought Cambodia was wrong and that the Cambodian government should be responded to in a tit-for-tat manner.

Anusorn said both governments would do best to place their respective countries' welfare as their top priority and boost collaboration, in order to achieve the Asean Economic Community.

"Some of our respondents - and I, personally - thought PM Abhisit Vejjajiva should be brave enough to move Foreign Minister Kasit Piromya to another ministry. Or he should appoint other people to be responsible for Cambodian affairs, because Kasit has had a personal conflict with Cambodia for a long time now," he said.

The government should adopt measures like low-interest loans or tax deductions to support the companies that were affected by this conflict, Anusorn added.