Utilization of Tariff Advantage From ASEAN-CHINA Free Trade Agreement: Thai-Lao Border Trade
China has distributed many apparel products to various ASEAN countries. Especially the Thai-Laos border market focused in this study is the destination forproduct distribution. China has used the tariff benefits from ACFTA as well, resulting in lower prices of apparel products in Thailand and Laos which affecting domestic entrepreneurs. Thai and Laotian entrepreneurs are also covered by the tax benefits of ACFTA in the import and export of apparel products, but not yet fully understand.This research aims to study the benefits of the ACFTA policy that affects the profitability of the apparel product seller of the Thai-Lao border market by collecting data from in-depth interviews from apparel products dealers at Tha Sadet Market, Nong Khai Province, Thailand and Khlua Din Market, Vientiane city, Laos PDR. Thisstudy uses a linear probability model (LPM) to analyze the utilization of tax benefits of ACFTA on the profitability of entrepreneurs. The study found that factors affecting the profitability of Thai dealerare shipping service and logistic cost of goods from China. In the part of Lao entrepreneurs,the study found that the tax benefits of ACFTA increase the profit opportunity of Lao entrepreneurs.
Index terms - Border trade, Thailand, Laos, ACFTA, Garment.