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Government urged to build financial architecture before opening up FTA with US

MCOT News, Thailand

Government urged to build financial architecture before opening up FTA with US

9 January 2006

BANGKOK, Jan 9 (TNA) - The government should build a financial architecture before establishing a free trade area (FTA) between Thailand and the United States, according to leading financiers.

Tawatchai Yongkittikul, Secretary-General of the Thai Bankers’ Association, said here on Monday that US-Thai FTA issues had not yet been discussed in the six round of negotiations in Thailand’s northern resort province of Chiang Mai.

Still, it might already be raised for informaion discussions earlier.

He said the financial matter would be one of the most interesting issues because the US had gained an experience for negotiations with Chile and Singapore on the issue.

He conceded that Thailand did not have a lot of experiences for the negotiations on a long-term plan, while the financial sector had rapidly changed and regulators had lacked enough competence in supervision.

More importantly, there had not yet been a financial architecture that how the country’s financial sector would shape up in the future, he pointed out.

He cautioned that it could be difficult for Thailand to adopt the full financial liberalization because it is not in a position to compete with other countries in terms of a capital size.

Kongkiart Opaswongkarn, Chairman of the Federation of Thai Capital Market Organizations, said it must be accepted that Thailand is not in the same class as the US in terms of competition.

Because of this, he said, the government needs to ask for an extension of the enforcement of the FTA deal with the US so that local financial institutions would have enough time to strengthen themselves in terms of operations and personnel.

The six-round Thai-US FTA talks are scheduled for January 9 amid a planned rally at the venue of hundreds of protestors. (TNA) - E005, E002