For many years, the performance of Thailand’s economy has impressed its neighbors and other countries around the world. Like many economies in the region, Thailand experienced a slow start toward progress. But, after more than a decade of consistent performance, the country seems to have finally found its momentum.

Recently, World Eye Reports interviewed Thai Finance Minister Thanong Bidaya and asked him to recap the past year and give his insights on what lies ahead for Thailand.

WER: What are Thailand’s most dynamic economic sectors and which of them will see the most growth over the next two to four years?

Bidaya: With the recent increase in global energy prices, it is clear that the petrochemical industry has been doing well. If the global energy market continues with the present trend for several years, as many experts predict, I am certain that the oil and gas business will record very strong growth in the near future.

In addition, capital goods and high-technology industries have the potential for rapid growth. Industries with high growth in the second quarter of 2005 were air conditioners, computers and hard disk drives, and commercial cars.

Those items were able to expand with sustained export demand. The conclusion of FTAs (free trade agreements) between Thailand and its partners in the future should open up greater opportunities for these businesses.

How has Thai manufacturing responded to China’s emergence at the forefront of manufacturing in East and Southeast Asia? And what advantages remain for foreign companies to manufacture out of Thailand?

Thailand is a good location for foreign direct investment. The Thai government has allocated resources to support and assist foreign manufacturers through many agencies such as the Board of Investments, Department of Export Promotion and the Thai Chamber of Commerce.

The government offers tax incentives, support services and import duty concessions to an extensive list of promoted industries.

The private sector is adapting to the changing competitive climate. Though China has become a strong competitor, it is our market. Thailand can export products in which China has no competitive advantage and Thailand can establish niche markets. Our niche products include sophisticated, upper-middle-class products such as furniture, interior decorative goods and jewelry.

New investment promotion strategies have been adopted to enhance Thailand’s competitiveness.

Major investments in support of industries such as automotive, steel and power are expected to increase productive capacity immensely.

What repercussions will the FTA with Japan have on the relationship between your two countries?

The JTEPA is of mutual benefit. It will strengthen a strategic partnership between two countries not only through liberalization and facilitation of trade and investment, but also through greater mobility and interaction among our people, and cooperation in various fields, such as agriculture, education, science, technology, energy and the environment.

The JTEPA will provide greater business opportunities and an even more favorable environment for investors. It should send a strong and positive signal to Japanese investors and business-people that we are ready to facilitate Japanese investments as much as we can in all aspects.

How important are Japanese economic relations to Thailand?

Bilateral trade in 2004 amounted to nearly $36 billion and was expected to grow over 15 percent last year. Thailand could be a production base of Japanese domestic consumption as well as export to other countries in the region. Japan has the technology while Thailand has biodiversity and a strong workforce. Both countries therefore should work together.

Other areas in which Thailand and Japan can work together are energy and infrastructure.

In which direction is Thailand hoping to lead the ASEAN (Association of Southeast Asian Nations) and the APEC (Asia-Pacific Economic Cooperation)?

For ASEAN to continue being vibrant in the 21st century, Thailand shares with fellow ASEAN members the aspiration to see its integration as one community. The plans to create an ASEAN Security Communiuty ASEAN Economic Community and the ASEAN Socio-cultural Community have been adopted.

We would like to see the ASEAN Charter that, when completed, would serve as the association’s legal framework and would contribute to achieving the ideal of having an ASEAN Community.

While the intensified integration of ASEAN is progressing, we do not want to see an ASEAN that is an exclusive, shut-in, inward-looking entity. Thailand has the vision of ASEAN as an active, open, significant player in the region.

On APEC, the core principle of the forum since the beginning is: prosperity through investment

and trade liberalization. Thailand adheres to this principle. However, a new dimension that Thailand has introduced is the human face of globalization. We would like APEC to pay attention to social issues.

What were the positive lessons gathered from the devastation and tragedy of the 2004 tsunami?

One lesson that can be learned from this calamity is to be prepared. Since the tsunami, Thailand has been active in creating early-warning systems and supporting international networks of cooperation on this matter. We are confident now that, with all systems in place, we will be more ready if the next calamity should hit us.

The other lesson, in the face of natural calamities such as the tsunami and Hurricane Katrina in the United States, is that the people of the world realize that humanity is one and respond to the suffering of fellow humans accordingly. We in Thailand would like to thank all, including the Japanese who gave us donations, for their response.