The Thai government delegation ended its visits to Sweden and Belgium with the announcement that the Thai-EU free trade agreement will be concluded in less than two years, as part of Thailand’s commitment towards free trade and competitiveness enhancement.
An economic adviser to Prime Minister Yingluck Shinawatra and chief of the Thailand Trade Representative, will head the Thai negotiating team. Aside from Singapore, which is the first Asean country to reach an agreement with the European Union, followed by Malaysia, Indonesia and the Philippines are set to start negotiations soon.
The Thai Cabinet gave the go-ahead for FTA negotiations, despite public opposition amid fears that alcohol and pharmaceuticals would be included in the deal.
While the FTA will ensure free flow of goods and services, the Thai delegation also wooed foreign investment to Thailand, convinced that the Bt2-trillion infrastructure investment will bolster Thailand’s competitiveness.
Thailand’s exports to the EU will enjoy lower taxes under the Generalised System of Preferences (GSP) until 2015. If the FTA can be concluded then, there should be no impact on Thailand’s export.
Both Thailand and the EU have pushed hard for the bilateral agreement, believed to boost bilateral trade and investment. The Thai-EU Business Council warned recently that Thailand would see its gross domestic product stunted by 1.2 per cent if it does not sign a free-trade agreement (FTA) by 2015 when the European Union’s tax breaks expire.
Thailand has bilateral agreements with Australia, India, New Zealand and Peru, while also being a part of the Asean-China FTA. According to the Foreign Trade Department, Thai exports under FTAs were worth US$41.7 billion last year, rising 4.41 per cent from $39.94 billion in 2011.