InfoQuest (December 2, 2020) - According to Director General Department of Trade Negotiations Auramon Supthaweethum, the Institute of Future Studies for Development (IFD) has completed relevant researches on the effectiveness and impacts of Thailand-EU Free Trade Agreement (FTA), Department of Trade Negotiations may summarize those results, and related feedback and discussions, and submit to Deputy Prime Minister and Commerce Minister Jurin Laksanawisit for review; after which such data shall be submitted to the International Economic Policy Committee and the Cabinet respectively, to resume negotiations with the EU. Four consultations were held between Thailand and the EU from 2013 to 2014, and then the activity has been halted ever since; but the fifth consultation may be made in 2021.
IFD researches show that tariffs abolishment between Thailand and 27 EU members (excluding Britain), in the long run, will bring forth a 1.28 percent increase in Thai GDP, totalling about 205 billion baht per year and a 2.83 percent growth in Thai exports to the EU, valuing 216 baht per year. Further, EU exports to Thailand may be 2.83 percent higher, amounting 209 billion baht per year. Some of Thai products will have a larger market and more opportunities to be sold in the Europe, such as automobiles and spare parts, electronic equipment, textiles, food, chemicals, latex and plastics.
Establishing free service zones for environment, logistics, finance, insurance, shipping and other important sectors will attract more European investments in Thailand, generate industry competition, reduce costs of related industries, and increase Thailand's economy by 5 percent to 801 billion baht per year. In addition, social macro analysis indicates that Thailand's economic development will lift 270,000 poor people out of poverty, increase farmers' income by 1.1 percent and narrow the wealth gap by 0.07 percent.
The most important point is to improve the protection of intellectual property rights so as to lengthen the registration process for more time to protect medical patents; accessible government procurement market will provide higher quality products and better services at lower prices.
Research results also demonstrate that the Thailand-EU FTA will throw certain impact on Thailand's sugar and dairy industries, but Thailand can still find a way out through negotiations, such as no tax exemption for goods impacting Thailand's local products, or striving for more time to make adjustments for local products.
"Effectiveness and impacts mentioned are based on scientific assumptions. Actually, the Department of Trade Negotiations shall still communicate with relevant departments, to safeguard our best rights and interests more comprehensively and cautiously in such negotiations, and to find a way out for the possible impacts and make immediate adjustments" Auramon said.
EU (excluding Britain) became Thailand's fifth largest trading partner in 2019, with a trade volume worth 38.2279 billion US dollars, Thai exports to the EU totalling 19.7359 billion US dollars and imports from the EU valuing 18.4921 billion US dollars.
Source: InfoQuest, by Ponnareu/Tanawat/Rachada, translated by Xinhua Silk Road
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