ASEAN AND THAILAND: A GERMAN VIEW
TALK ASEAN AND THAILAND: IN AN INTERVIEW WITH ASEAN AFFAIRS, DR.HANNS SCHUMACHER,GERMAN AMBASSADOR TO THAILAND,EXPRESSES HIS VIEWS ON THE ECONOMIC RELATIONSHIP OF GERMANY AND THE EU WITH ASEAN AND HIS HOPES FOR THAILAND.
In a candid interview, German Ambassador to Thailand Hanns Schumacher shares with Asean Affairs his assessment of recent events in Thailand.
Q: What is the impact of Germany’s and Europe’s current economic situation on Asean countries?
A: Total EU-share in Asean’s exports amounts to about 13 percent. Intra-Asean trade accounts for more than 30 percent - a figure which is rising due to the reasonable and dynamic free trade policy of the regional body, which has more or less copied the success of the European single market. In addition, direct Asean trade with European problem cases like Greece is marginal. To answer the question bluntly: the impact of Europe’s underperformance on Asean countries in the short and medium term is negligible. But we can turn around your question, “What can Asean countries learn from the European experience”? For sure, one conclusion must be that an excessive debt build-up, if not properly brought under control, can have almost a lethal effect on a country’s financial ratings and political reputation. On the other hand, Europe’s recovery, in particular, Germany’s recovery as Europe’s major economy and the slowly stabilizing Euro, which even during the crisis so far never fell below its emissions rate, will add a fresh and tangible demand impetus to Asean’s markets.
Q: Since our last meeting, political developments have boiled over in Thailand and now seem at a standoff. What are your views?
A: Thailand has long been seen as an “anchor of stability” in the region. The continuous unrest since the military coup in 2006, the ensuing frequent change of governments and the internal tensions since the Abhisit government came to power put this reputation at risk, no doubt. The world is looking at Thailand to see, whether a lasting reconciliation can be achieved between the different political camps. This takes two to tango and the onus of proof to deliver is on both sides, the government of the day and the opposition. On the other hand, regarding the development of the economy, one could get the impression as if politics and business are separated by a kind of “firewall”. Thailand’s first quarter export figures are on a record level, the growth forecast 2010 is quite positive, the baht gets stronger and stronger. The government’s measures to strengthen the economy are clearly successful. As Thailand is suffering from a phenomenon, which seems to be the negative side of the globalization coin, the uneven distribution of wealth and the widening gap between rich and poor, tensions could be reduced if all parts of the population will be able to take advantage of this positive development, and not only a privileged few.
Q: How do German companies view Thailand now, particularly as to future investments?
A: The Asia Pacific Conference APK, the largest gathering of German business representatives in South East Asia, a biannual event, which took place in May in Singapore, provided a good yardstick: Thailand continues to be a hub for German investments in the area. Business people are business people and they look for fundamentals. If you look at these, then even during the recent political crisis, the Thai economy has risen by 12 percent, the highest gross domestic product increment in 15 years. Fundamentals in infrastructure, banking, industrial networks, combined with reasonable costs and a disciplined and qualified workforce, continue to look good. Thailand got good credits for that at the APK. I did regret that Thailand was the only Asean member state, which did not consider it necessary to be represented there on a senior level. One should never take foreign business interests for granted – your neighbours, like for example , Vietnam, are becoming strong competitors for high quality and state of the art German investment as an important means for technology transfer!
Q: What specific steps are European countries looking for Asean to take in the area of intellectual property rights and the production and sale of counterfeit goods?
A: An Asean intellectual property action plan, binding from 2004 to 2010, is in existence. This led, for example, to the signing of an EU-financed “ASEAN project on the protection of intellectual property rights” in Bangkok just last year, 2009. Intellectual property awareness, education, their use as a tool for economic development and integration in Asean as well as of Asean countries into the global economy are important to mention in that respect. As for Thailand in particular, many tourists might think about fake textile or watch brands as well as IT products on sale in some street markets. More serious are fake pharmaceuticals, which, to a small extent, still do exist. However, without wanting to downplay these serious problems, overall, Thailand has left such stage of economic development long and far behind. Thailand is at a level of its economy where protection of its own intellectual property, together with high-value product designs manufactured within its borders is of much greater significance than any cheap, short-lived gains from fakes. As for patent-and trademark protection in general, these also work quite well in Thailand, through specified courts and tough law enforcement. Continuing working together in this direction is what Asean and the EU need.
Q: Has the next meeting of the Thai- German Joint Economic Committee (JEC) occurred or when will it occur? What are your expectations for the results of the meeting?
A: Thailand has expressed an invitation to the German side to convene the JEC in spring 2011. We are at a stage to negotiate on a convenient date. Foreign Minister Kasit will meet during his forthcoming meetings in Berlin on July 5 and 6, amongst others, German Minister for Economic Affairs and Technology, Rainer Brüderle, to discuss the options. We believe it is necessary to establish a sound and broad-based dialogue, not only on the government level, but between business representatives of both countries, about priorities of our future cooperation. We are very interested to foster our reputation as a partner widening the scope of alternative energies in Thailand. A serious point to be raised, if not solved until then, would be the suspension of pending investments in Map Tha Put, which affects, for example, one of Thailand’s biggest German investors, Bayer Thai – a company with an impeccable record when it comes to environment protection. Thailand’s outstanding international competitiveness in the past has always been based on the predictability of administrative proceedings and the ease of doing business due to quick bureaucratic procedures.