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Japan, Thailand edge toward free-trade deal, without rice

Kyodo | Wednesday November 10, 5:39 PM

Japan, Thailand edge toward free-trade deal, without rice

Trade negotiators from Japan and Thailand agreed Wednesday to accept offers from each other that will prompt tariff eliminations on industrial goods if their free-trade agreement is approved.

They resumed free-trade talks Monday after Thai Prime Minister Thaksin Shinawatra decided last month to withdraw rice from the negotiating table.

During the three-day talks ended Wednesday, Japanese negotiators tabled an offer to immediately eliminate tariffs on nearly half the products currently traded between the two countries, Thai chief negotiator Winichai Chaemchaeng, a deputy director general in the Thai Commerce Ministry’s Trade Negotiations Department, said.

Winichai added the products Japan would promptly end tariff barriers on were industrial goods such as electrical and electronic products while Thailand offered to instantly slash tariff barriers on about 29 percent of products traded with Japan, mostly raw materials for industrial use.

They also discussed another offer to gradually phase out tariff barriers between the two countries in 10 years, according to Winichai.

"We could not have a fixed modality for our tariff reduction scheme. We are now engaging on a request-offer basis. Japan plans to give assorted timeframes for tariff cuts ranging from one to 10 years while Thailand is to offer tariff cuts between five and 10 years," Winichai said.

The staged tariff cuts are likely to cover only about 5 percent of goods Japan trades with Thailand while the tariff reductions by Thailand are likely to cover a wider band, but Winichai declined to elaborate.

A Japanese negotiator said the three-day talks at a Bangkok hotel made "substantial" progress, added they have settled pledges on tariff cuts for most of products that need no negotiations while they have also prepared to move forward on "sensitive" products in the future rounds of negotiations.

Winichai said, "There are many ways to deal with the sensitive products. It is not necessary to completely abolish the tariff. Japan needs more time to consult with their stakeholders and one month would not be enough. We will not demand they accelerate the consultations."

The Thai negotiator added he was still "optimistic" for a successful free-trade deal with Japan although the Nation newspaper reported Wednesday that Japanese chicken farmers came to Bangkok this week to lobby for removal of poultry products from the free-trade negotiation.

Winichai said he received a letter from Japanese poultry importers stating chicken is not a sensitive product for Japan and that the country does not produce enough poultry products for domestic consumption.

However, Winichai stressed that commodities sensitive to Japan are not only poultry but include tapioca starch, seafood products, pineapples, footwear and leather.

All those items together account for some 13 percent of Japan’s imports from Thailand.

Thailand has made its "sensitive" commodities steel, automobiles and auto parts and petrochemical products. Together, they account for some 25 percent of Thailand’s imports from Japan.

The next full round of talks on the Japan-Thailand Economic Partnership Agreement, which will be the fifth since the talks started early this year, is slated for Dec. 7-9 in Bangkok, according to the Japanese official.

In addition to talks on liberalization of trade in goods, negotiators from both sides are expected to discuss services liberalization and freer movement of people, the official added.

 source: Kyodo