Thailand and the EU have agreed upon the joint political will to pursue free trade agreement (FTA) negotiations, with the long-awaited talks scheduled to kick off in the first quarter of this year.
Speaking after a meeting in Brussels with the EU Trade Commissioner Valdis Dombrovskis on Wednesday evening, Commerce Minister Jurin Laksanawisit said the two sides agreed on the political intention to form the FTA. This is the first time the two parties have jointly expressed their political intention to pursue internal processes to pave the way for a free-trade pact.
Mr Jurin said he would shortly ask for the Thai cabinet's consent to go ahead with the FTA plan.
"Both parties have pledged to complete the internal processes as fast as possible so that the FTA talks could start in the first quarter of this year," he said.
The EU, comprising 27 member states, is Thailand's fourth-largest trading partner after China, the US, and Japan.
FTA negotiations with the EU were put on hold after the 2014 coup as the EU protested against what it deemed to be the suspension of democracy.
In 2022, trade volumes between Thailand and the EU tallied US$41 billion, accounting for 7% of Thailand's total trade.
Thai exports to the EU totalled $22.7 billion last year, up 5.17% from the year before. Key export products included computers, computer equipment and components, gems and jewellery, air-conditioners and components, rubber products, and electronic circuit boards.
Meanwhile, imports from the EU reached $18.2 billion, with important products including machinery and components, pharmaceutical products, chemicals, electrical machinery, components and tools, and equipment related to science and medicine.
The study by the Institute of Future Studies for Development, commissioned by the Trade Negotiations Department, found that an FTA with the EU, once implemented, is expected to stimulate not only exports but imports and investment as well, helping to raise Thailand's GDP by 1.28% a year, or about 205 billion baht.
The pact is also expected to help raise exports by 2.83%, or about 216 billion baht, and imports by 2.81%, or about 209 billion baht.
Other economic factors such as household consumption and public welfare would also benefit.
Thai products expected to reap benefits from such a pact, if implemented, include automobiles and parts, garments, electronics, chemicals, rubber, plastics, food and processed food products, machinery and parts, construction, and leather products.
Thai products likely to feel the pinch from the FTA include sugar, vegetables, fruits and beans.
The study also found that new trade partnerships were expected to arise during the negotiations, such as over state procurement, the environment, labour, and trade competition.