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Financial issues back in Thailand-US FTA talks

Financial Express, India

Financial issues back in Thailand-US FTA talks

7 January 2006

(Reuters) BANGKOK, JAN 6: Services and financial sectors, left aside in early rounds of talks on a US-Thailand free trade agreement, will be put on the table during the sixth round next week, a Thai negotiator said on Friday.

Chief negotiator Nitya Pibulsonggram said Thailand would raise the financial issues important to Washington but would insist on a transition period to allow the Thai financial sector to get itself ready for increased competition. “We did not talk about the financial and service sectors during the last five rounds of talks as the U.S. understood our concerns,” Nitya said. “This time, the issues will be raised and we will ask for a transition period for our financial sector to adjust to the competition,” he added.

However, Nitya declined to define the transition period needed by Thailand, which suffered a financial collapse in 1997 that triggered an Asia-wide crisis. The United States has insisted Thailand open the sector if an FTA were to be agreed in talks which began early last year and Nitya said Bangkok had services, such as spas and restaurants, it wanted included in an agreement.

The United States is Thailand’s largest trade partner, with Thai exports worth $15 billion and imports worth $7.2 billion in 2004. Pharmaceuticals, another delicate issue, were also likely to be discussed in the northern city of Chiang Mai next week despite domestic opposition from groups which fear Thailand’s generic drug industry will be hurt, Nitya said. “I insist that no agreement has yet been made at this point, but I expect that the U.S. would raise the drug issue in this round as it was postponed for a long time,” Nitya said.