In the wake of the recently introduced Japan-Thailand Economic Partnership Agreement (JTEPA), the number of Japanese buyers attending BIFF&BIL2007, the Bangkok International Fashion Fair & Bangkok International Leather Fair, is expected to be higher than last year.

Under the agreement, Japan will cut tariffs on textiles and garments from 12% to zero starting from October this year. And, as Japan imports Thai garments worth $20 million each year, 0% tariffs should trigger rapid growth for textile exports, which currently total $260 million per year. Textile companies supplying the Japanese market are expected to see sales increases of between 20% and 30%, which will positively impact Thailand’s trade figures by the fourth quarter.

Chairman of the Federation of Thai Textile Industries, Chen Namchaisiri, said that the JTEPA will encourage Japanese investors to set up new factories and joint ventures selling duty-free products, which will reduce production costs. He added that delegates from the Japan Textile Federation have been invited to attend the fair—which will take place in Bangkok on August 22-26—and that the number of Japanese buyers attending is expected to increase by 30%.

Director general of the Department of Export Promotion, Rachane Potjanasutorn, also spoke positively of the new agreement. “This is good news, particularly under the prevailing investment climate where domestic and foreign businesses need a confidence boost with regard to the Thai economy and potential joint ventures.  As a result of the JTEPA, I believe Japanese investors will return to Thailand,” he said. 

To qualify for 0% tariffs, garment exporters must import fabrics from Thailand, Japan or other ASEAN countries and the fabrics must be cut and sewn in Thailand.