Europe open to Thai trade talks
Bangkok Post | 3/03/2009
Europe open to Thai trade talks
Asean’s slow process hampers progress
By: PARISTA YUTHAMANOP
The European Union is willing to begin bilateral free trade talks with Thailand in a process that would move together with existing Asean-EU talks, said Philippe Meyer, the directorate-general for trade at the European Commission.
Mr Meyer, the EU’s chief trade negotiator, noted that six rounds of talks had been held since May 2007 towards an Asean-EU free-trade agreement.
But the slow integration among the 10 Asean members have hampered the process, he said.
"The process in the entire region is extremely slow. It will lead to an agreement if we manage to conclude talks, but we are not ambitious. Asean is not well integrated yet," Mr Meyer said.
"The plan to achieve an Asean Economic Community by 2015 or 2018 is too slow to conclude the [Asean-EU] FTA. Considering the global economic downturn, we need to take action much more rapidly than that."
"It takes time for a region to behave like a region. So we need to go faster."
Europe was willing to move forward with bilateral talks with Thailand and other Asean countries while still maintaining the broader framework of regional trade talks.
"We will move with those who are ready. There is no reason why Thai businesses have to wait for the readiness of other countries," Mr Meyer said bluntly.
"We are waiting for a signal. We are not imposing anything on Thailand. We are ready to engage bilateral negotiations if Thailand is interested. We look forward for any demonstration of interest from the Thai side to start negotiation."
Outside of Thailand, other Asean members that the EU was interested in holding bilateral talks with included Singapore, Brunei and Vietnam.
"Singapore is among the most interesting countries, as well as Brunei. When we look at trade and figures, we think Vietnam will be interested as well," Mr Meyer said, noting that Indonesia was expecting an election shortly while Malaysia was engaged in trade talks with the United States.
Outside of the Asean bloc, Europe is one of Thailand’s largest trading partners. According to the Commerce Ministry, Thai exports to 25 countries in the EU totalled $23.39 billion last year, up 7.86% from the year before, with imports last year valued at $14.2 billion, up 19.35%.
Mr Meyer said conflicting interests among Asean and the gap in development regarding international trade across the region were among the constraints in negotiating a region-to-region trade agreement.
"You are competing between manufacturers in Vietnam and Thailand in products like shoes," he said.
"The problem of trade agreements with the entire region is that a number of your countries have different interests, and some do not talk about certain issues such as IP [intellectual property] and competition."
Mr Meyer said 51% of Thai products are exported to the EU with zero tariffs, and 23% of all products have been granted GSP (generalised system of preferences), which are subject to regular revision every three years.
A bilateral trade pact would eliminate uncertainties on GSP products, he said.
An EC study showed that a successful trade deal would substantially help both countries. An Asean-EU free-trade agreement could boost Thai exports by 20% and economic growth by 2.8 percentage points, with European exports rising 24% and growth by 0.1 percentage points.
Key European exports to Thailand include machinery, chemicals, pharmaceuticals and services. Key Thai exports to Europe include poultry, agricultural products, computers, clothing and auto parts.
Mr Meyer said he was hopeful that a Thai-EU deal would help open the door for further trade talks across the region, and that bilateral talks would not undermine multilateral ones.
"If we manage to agree on something reasonably ambitious, then it will pave the way for the work with other countries," he said.
While farm products, a key Thai export, would likely be a sensitive issue in any negotiation, Mr Meyer said the issue could be discussed.
However, Mr Meyer said the EU was unlikely to change its stance on certain criterion like sanitation and labour, although they have been considered non-tariff barriers by most local manufacturers trading with the 27-member state.
"Our citizens want to protect standards in hygiene, the environment and labour rights as countries develop. We want to make sure that any increase in trade will not decrease any protection in worker rights," he said.
