Thai-EU free trade talks set to resume after hiatus
Thailand is returning to the negotiating table for a Thai-European Union (EU) free-trade agreement (FTA) after the green light was given by the new government, according to Auramon Supthaweethum, director-general of the Trade Negotiations Department.
"This follows a directive from the new Deputy Prime Minister and Commerce Minister Jurin Laksanavisit who announced in parliament last Thursday that the country will revive FTA negotiations with the EU which have been stalled for years because of political problems," Ms Auramon told media on Monday.
FTA negotiations between Thailand and the EU, the country's third-largest trading partner, have been on hold for about five years. After the 2014 coup and introduction of military rule, the EU discontinued FTA negotiations with Thailand to protest the suspension of democracy. Instead, the EU pursued trade negotiations with other Asean nations and has signed FTAs with Singapore and Vietnam.
Ms Auramon said she will inform relevant stakeholders including EU representatives, the private sector, as well as civic groups about its plan to revive negotiations.
Two-way trade between Thailand and the EU trade rose by 6.5% to US$47.3 billion (1.4 trillion baht) in 2018, accounting for 9.4% of the total trading volume.
Meanwhile, Thai exports accounted for $25 billion, up by 5.2% from the previous year, with imports up 8.17% to $22.3 billion.
Important export items include computer parts and components, automobile parts, gems and jewellery, electrical circuits, rubber products, air conditioners and their parts, and processed chicken.
Meanwhile, key imports include machinery and parts, aeroplanes, gliders, chemical products, medical supplies and medicines, electrical devices and parts, and diamonds and precious stones.
The main objective of the trade negotiations is to liberalise access to the European market by decreasing protection on European imports whereas the bloc reportedly wants access to local medicines, cars and alcoholic beverages. Along with goods, the EU wants to see the service sector open up through an FTA as well.
EU companies are already heavily investing in these sectors without an FTA, most notably with Airbus's plans to establish a multi-billion-baht maintenance, repair and overhaul facility for jetliners at U-Tapao airport. The project is a joint venture with Thai Airways and is part of the Eastern Economic Corridor scheme.
Since Thailand has no FTA with the EU, which cut the Generalised System of Preferences for Thailand in 2015, all Thai export products are subject to EU tariffs. An FTA would help Thai exports.