Interview with Dr. Gustav Gressel
Q : Austria is an exports driven economy. But the years in the past have no evidence of a strong trade relation with Thailand. Why is that so when Thailand has investors from around the world?
A : Last year, Austrian export in Europe exceeding 100 billion EUR. Sure, People are focusing obviously the neighbor countries. And people are really focusing in central, east, south east and Europe
It is obvious we have a competitive to advantage group of the other European. It is not only that because we are the country who is no danger than everybody. We are small. There are 8 million people. We are number one investor in almost all of the Balkan countries from Slovenia, Croatia, Bosnia, Romania, Serbia … etc.
Burma is becoming a part of the rest of the world again. Laos and Cambodia start developing with relatively to the society.
Thailand is the most fear but people will come in because they … export open. People were the most opposing to the opening of the border that cheap labour might come in and all that. And finally we were the country who had the most profit out of it because certainly our companies started export tourism in these countries establishing their dollar competence for sure. The cheap labour was exported but we are not a cheap country.
We will never compete by a price; we compete by technical solution, via quality. So that in the end it yields higher profit as you take it. That’s also why we are here in Thailand. Thailand is not so much on the map. It’s not the daily discussion subject. The daily subject is China, but china is an enormous market but also has its problems…. People are looking for alternative and there are not so many; there is Thailand, there is Vietnam, which is developing good but doesn’t have the infrastructure as yet. Sure there’s India, the second biggest market. Asia certainly gained an importance; people know they are doing extremely well in North America and South America. Then Africa is a small part if our business.
North America is a big market for Austria?
We are doing really well in North America. America is the fourth biggest trading partner of Austria.
Also there’s this strong Euro and weak dollar but we don’t sell via the price.
Our economy is not based on …huge multinationals. Our economy is based on quality concerned companies which are technological because it is the only way they can compete. Some of them, in their little leash, are world leaders. They cannot be all encompassing like GE , Siemens… but Siemens is Austrian and quite strong.
When I talk about the importance when we export to neighbor in Hungary, in 2006, three and a half billion EUR that is 3 times as much as we export to China. So we are an export trade economy and I think Thailand is now on the map because we look at it not as Thailand but as South East Asia market. It is a regional market of about 500 million people, excluding India and China; the traditional South East Asia.
And we all know that during the last few years it has won many projects.
We are looking the project that much more looking into Vietnam. The project will take a while so you can make it boom …First half of the year we have 100% increase. Last year we had also something like 70% increase. But I know cannot hold it until it is finished and you wait for the next project.
Now Thailand is more stable. Here the statistics were quite good. Last year we had an increase of 22%. With EUR we have 153 million EURs to Thailand. You have to multiply that by 48. So it’s a nicer number. There has been many things. You have to look at the local economy. You have to look everybody looking where will be going. When I look at the 7 months, we have an 22 percent increase. At the end of the year there will be the final ticket you will have by a per march . It is a good growth.
We have about 125 companies that pea more than 20 Austrian companies manufacture more and more because sometimes it is a family and sometime it is a real manufacturing.
Yesterday, I was their opening up the company who will the basically they produce in Austria and they have another factory in North American and one is in South America and for east asia they do it here. It is in their in medical field. Company Over thousand.. They decided finally after long study on Thailand then push investment due to the security here which for investment. Now they got the devise so It is easy. But certainly was keeping a lot of people of the discussion of FTA. I think this discussion when the complete a long way instead of stable case there was some easy.
I try to promote Thailand as with all the political but the economically don’t stable south country. Problem is if there the ablily that you can plan regulation will stay act it. But if it is not, you will get a problem to convince .. at the moment I still promoted that I hope that all this kind of … will not be followed by action. We are in the country which is still extremely friendly. We have a lot of competitors in this field so we should be fear to everybody and everybody should get it. We have a chance to do as long as they ask. It is very strong standard. When the standards are lowered then we will have no business.
1.Austrian economy is definitely export-driven, with exports exceeding 100 billion EUR for the first time in history in the year 2006. Austrian exporters, however, have focused primarily on Europe during the last decade. In 2006, Austrian exports to neighboring Hungary amounted alone 3,5 billion EUR, which is approx. 3 times the volumns of Austrian exports to China (1,25 billion EUR in 2006) and approx. 30 times the exports to Thailand. Austria has culturally and historically always had close ties with Eastern and South-East Europe. Austrian companies are therefore more willing to invest in these countries than, for example, in Asia. However, since markets in Eastern Europe become more and more saturated, this situation might change.
- you have to decline the field which field you are to look in . Environmental field I think we face the beginning faces of the favorable energy. Their project I would love to go in and these are the long term project. I think this is a difficult field where is the Thailand is a basically and fully develop country.
Q : EU is ASEAN’s third largest trading partner and ASEAN represents approximately 6% to the total EU trade. How much does Austria contribute?
A : In 2006, cumulative Austrian exports to the EU (24) amounted to 72,5 billion EUR. However, it is somewhat problematic to compare EU internal and external trade data since, within the EU, there are virtually no trade barriers left.
Q : Comment on the Prospects of ASEAN-EU FTA
A : It is something we both part should be looking much more .. into it. Because I think if you get EU ASEAN FTA , export in both side. What the EU want is to get a really strong . and agreement that cab. .that all that is make sense to do it. The worst thing that can happen to economy is protectionism because we are only supported company which normally don’t right anymore to survived. There is a negotiation ongoing.
An EU-ASEAN FTA would be very beneficial for the Austrian companies active in the ASEAN region and would boost the exports of ASEAN economies to Austria as well. In addition, it would be very positive signal for Austrian companies considering investing in the ASEAN region. Current status: Negotiations are ongoing.
Q : Out of the seven nations which shall participate in ASEAN- EU FTA, Thailand is one of the flourishing economies. Will Thailand gain recognition by EU as a potential market, keeping in mind the new laws on Foreign Business?
A : Thailand has been a well established and reliable trading partner for Austria for decades. However, Austrian investors are well aware of any changes in the legal framework that might potentially have a negative impact on their activities in the region. Thailand should be also aware of the fact that other countries in the region are undertaking huge efforts to further liberalize their legal framework in order to attract foreign investors.
Q : There are many industries in both Austria and Thailand that are similar. For example: both are export driven, major exports being in manufacturing and foodstuff etc. If FTA is signed, how can the two countries benefit from their trade relations?
- You will find a much more companies. You have a stabled environment . Company who export more here are only one who will set of here because you check for logistic.
- Both side you get much more investment and you open out and are going out to the investment. And then go to the Europe.
A : That will depend on the sectors covered by the FTA. Sure is, however, that both Austrian and Thai companies will both tremendously benefit from the Agreement.
Q : How can Austrian investor’s confidence be enhanced in Thai economy? How are you working in collaboration with the Thai government in this regard?
A : Austrian investors appreciate good infrastructure, adequate cost structures, a skilled local workforce and a stable legal framework governing their activities. Thailand can provide all these factors and much more but is up to the Thai government to ensure that this situation is kept and further improved. We are glad that the relevant Thai authorities are well aware of this fact, too.
Q : How has ASEM been helpful in building strong economical and cultural bond between Austria and Thailand in particular?
A : The ASEM initiative has been a significant step to strengthen the ties between Thailand and Austria in a cultural and political context and is has been instrumental to build awareness of the ASEAN region in the Austrian public. Thanks to ASEM, the ASEAN region has been increasingly considered as a potential market and sourcing base for Austrian companies who- up to that time- primarily had China in mind when thinking about doing business in Asia.
Q : Austria is at present investing in most eastern European countries. ASEAN too is an emerging trade block with much to offer. Does Austria have plans to invest in Asean in the near future?
A : Austrian companies are increasingly turning an eye to Asia since many Eastern European markets have become already saturated. We have already seen a certain influx of investment in the ASEAN region and to Thailand in particular during the last years. Provided the legal and political frameworks remain stable, I expect this trend to continue and even gain momentum in the near future. Up to now, the primary investment destination in Asia has been China but an increasing number of Austrian companies become aware of the necessity to spread their risks and thus venture into new markets. I am convinced that ASEAN and especially Thailand will become one of the most preferred locations for Austrian investment in Asia during the next decade, especially for manufacturing companies.