Since the beginning of this year, Japan has been active in striving for "permanent participation" in the international political arena, and its economic diplomacy can not be underestimated. In particular, the auto diplomacy offensive in Southeast Asian countries has become increasingly fierce, causing European and American auto companies to panic.
Over the years, Japan has been seeking to reach a free trade agreement in this region of Southeast Asia so that its automakers can enter the market in a tax-free manner in 10 countries with 530 million consumers. Today, the automotive market in Western developed countries is already saturated, and the emerging economic entity of ASEAN is a lucrative and increasingly important market. However, the Japanese government’s auto diplomacy in Southeast Asia will seriously threaten the interests of American and European auto makers.
Take Ford Motor Company of the United States as an example, the trade agreement between Japan and the Philippines will threaten Ford’s interests in the Philippines. Ford Motors, like other manufacturers, faces high tariffs when exporting cars to the Philippines. For this reason, the company invested 250 million U.S. dollars to set up factories in the country to escape this tax. Therefore, when Ford executive vice president Schultz heard at the end of last year that the Philippines and Japan would reach a bilateral trade agreement, the tariffs on Japanese cars and accessories could be reduced, and they were unhappy. Schultz was directly dissatisfied with Arroyo's dissatisfaction with her role as advisor to the President of the Philippines’ Arroyo Industrial Advisory Board: If she accepts Japan’s proposal, the Philippine government is likely to face non-Japanese car companies no longer investing one point in the Philippines. The situation of money.
It is reported that Japan and the Philippines will soon reach an agreement that the Philippines will gradually cancel tariffs on imported cars and auto parts from Japan; in exchange, Japan will allow Filipino nurses to work in Japan because of the rapid aging of population and the large demand for health care workers in Japan. increase. When Arroyo is expected to visit Japan in mid-September, the two countries will sign a free trade agreement and Japan’s auto diplomacy in the Philippines will be completed. This progress is also a threat to China’s economic exports in this region.
Since 1997, U.S. and European car manufacturers have invested hundreds of millions of U.S. dollars in South East Asia. At that time, ASEAN was committed to establishing a tax-free common trade zone to attract foreign investment. Cars transported from one member country to another must pay at least 100%. Tariffs. Although ASEAN stated that by 2005 it will reduce the tariffs on autos or parts that are more than 40% localized in member countries to a maximum of 5%, the current progress of ASEAN countries’ trade integration is quite slow. For example, Malaysia stated that in order to protect the domestic auto industry, at least until 2008, it started to reduce tariffs.
Japan’s auto diplomacy in Southeast Asia began in 2002 when Japan negotiated the first free trade agreement with Singapore. At present, Japan is still negotiating with Thailand and Malaysia. European automakers dominate the lucrative luxury car market in Southeast Asia and invest in local factories to take advantage of free trade zones. DaimlerChrysler's Mercedes-Benz, BMW, Volvo, Peugeot Citroën and Volkswagen have all set up factories in Thailand and hope to achieve 40% localization requirements.
However, in the trade negotiations with Thailand, Japan hopes to obtain tax-free concessions for its luxury cars. If so, the price of luxury cars such as Lexus produced by Toyota Motor Co., Ltd. will be reduced by half, which is much lower than the current 5 million baht (about 120,000 U.S. dollars), thus causing a fierce impact on Mercedes-Benz and BMW cars.
Thailand’s negotiators are not willing to cancel tariffs before Japan further opens up the agricultural market, but Malaysia has taken actions. A consulting agency in Bangkok described Japan’s free trade plan as a “Trojan horse†that aims to “consolidate the already strong position of Japanese car manufacturers in the region. This is a creative approach to entering ASEAN with low tariffs.â€
Southeast Asia is indeed a market worth fighting for. At present, the sales of autos in developed countries have stagnated, and the annual demand in Japan and the United States hovering around the level of 6 million and 16 million vehicles respectively. However, according to Ford Motor’s forecast, the demand for cars in Southeast Asia will increase from 1.7 million in 2004 to 3 million in 2014, an increase of over 76%.
Japanese trade negotiators said they have realized that their car diplomacy will cause some dissatisfaction. However, if American and European automakers regard Japan’s diplomatic move as a threat, Japan also considers this to be its response to the threat. Japan’s commitment to reaching a bilateral trade agreement is a direct response to the establishment of economic ties between China and ASEAN. In 2001, the Chinese government and ASEAN agreed to sign a free trade agreement by 2010. Moreover, at the end of 2004, both parties signed a trade agreement on goods.
China does exert great pressure on the minds of the Japanese trade negotiators. The relevant person in charge of regional cooperation affairs of Japan’s Ministry of Economy, Trade and Industry said: “Japan has always strongly demanded that other countries open their markets rather than open their own markets. China’s open area is wide and the economy maintains rapid growth. This contrast makes me feel Huge threat."
In Malaysia, the largest sedan market in Southeast Asia, two national car projects rely on technology and key auto parts from Japanese partners, including Daihatsu Motors and Mitsubishi Motors of Toyota Motor Corporation. Japanese automakers also control high-speed markets such as Thailand and Indonesia. Due to Japan’s leading role in the automotive sector in Southeast Asia, the free trade agreement signed by ASEAN member countries with other countries will enable Japanese companies to take advantage of opportunities to enter other markets such as India.
India and Thailand are still negotiating to cut the tariff on some auto parts by half. However, some Indian auto makers expressed dissatisfaction with the plan. They said that Japanese companies will use this to send parts produced in Thailand to the assembly line in India.
Wuxi Yizhiling Locomotive Development Co. LTD , https://www.yizhilingev.com