Thailand’s FTA strategy to open up new markets
Thailand Business News | 21 July 2023
Thailand’s FTA strategy to open up new markets
by Akanksha Singh
Thailand is pursuing an ambitious free trade agreement (FTA) strategy to expand its trade and investment opportunities with various partners around the world. The country has already signed 13 FTAs with 18 economies, including China, Japan, India, Australia, and the European Free Trade Association (EFTA).
Thailand is currently negotiating several more FTAs with potential partners such as the European Union (EU), Pakistan, Turkey, and Sri Lanka.
Key Takeaways
- Thailand is actively pursuing an ambitious free trade agreement (FTA) strategy to expand its trade and investment opportunities with various partners worldwide.
- The country has already signed 13 FTAs with 18 economies and is currently negotiating several more, including with the European Union, Pakistan, Turkey, and Sri Lanka.
- Thailand’s FTA strategy aims to enhance its competitiveness, provide greater market access for businesses, and support economic recovery from the COVID-19 pandemic.
- The country is also a member of the Regional Comprehensive Economic Partnership (RCEP), which was signed in November 2020 and has come into force in 2022. The RCEP is the world’s largest FTA, covering 15 countries and 30% of global GDP and trade.
Thailand has been actively pursuing FTAs with various countries and regions, both bilaterally and multilaterally. As of July 2023, Thailand has signed 13 FTAs with 18 countries or regions, covering about 60% of its total trade value. These include:
- ASEAN Free Trade Area (AFTA)
- ASEAN-China FTA
- ASEAN-Japan Comprehensive Economic Partnership (AJCEP)
- ASEAN-Korea FTA
- ASEAN-Australia-New Zealand FTA (AANZFTA)
- ASEAN-Hong Kong, China FTA (AHKFTA)
- Thailand-Australia FTA (TAFTA)
- Thailand-New Zealand FTA (TNZFTA)
- Thailand-Japan Economic Partnership Agreement (JTEPA)
- Thailand-Peru FTA (TPFTA)
- Thailand-Chile FTA (TCFTA)
- Thailand-India FTA (TIFTA)
- Thailand-Pakistan Closer Economic Partnership Agreement (TPCEPA)
Thailand is also negotiating or exploring FTAs with several other countries or regions, such as:
- Regional Comprehensive Economic Partnership (RCEP)
- Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)
- European Union-Thailand FTA (EUTFTA)
- United Kingdom-Thailand FTA (UKTFTA)
- Thailand-Turkey FTA (TTFTA)
- Thailand-Sri Lanka FTA (TSLFTA)
Thailand’s FTA strategy aims to enhance its competitiveness and resilience in the global market, as well as to support its economic recovery from the COVID-19 pandemic. The FTAs will provide Thai businesses with greater access to new and emerging markets, lower tariffs and non-tariff barriers, and more favorable rules of origin and standards. The FTAs will also enable Thailand to participate in regional and global value chains, attract more high-quality FDI, and foster innovation and digital transformation.
Thailand’s pursuit of free trade agreements aligns with its overall strategy to enhance its competitiveness and boost economic growth. These agreements allow the country to access new markets, reduce trade barriers, and attract foreign direct investment (FDI).
One notable FTA that Thailand is involved in is the Regional Comprehensive Economic Partnership (RCEP). This agreement involves 15 countries and covers a significant portion of global GDP and trade. By being a member of RCEP, Thailand can tap into the vast market potential of member countries and deepen its economic integration within the region.
In addition to the RCEP, Thailand is also exploring the possibility of joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). This multinational trade agreement includes countries such as Japan, Canada, Australia, and Mexico, among others. Joining the CPTPP would further expand Thailand’s trade opportunities and strengthen its trade relationships across the Pacific region.
Moreover, Thailand is actively negotiating an FTA with the European Union (EU). A potential EU-Thailand FTA would provide access to one of the world’s largest consumer markets and enhance trade relations between Thailand and the EU member states. This agreement could further stimulate economic growth and diversify Thailand’s export markets.
Furthermore, Thailand is exploring the prospect of an FTA with the United Kingdom. With the UK’s departure from the EU, Thailand sees an opportunity to establish a bilateral trade agreement with the UK, facilitating trade and investment between the two nations.
It is worth noting that these FTAs not only focus on traditional trade aspects but also aim to foster innovation and digital transformation. Thailand recognizes the importance of leveraging technology and embracing digitalization to enhance its global competitiveness. These agreements open up avenues for collaboration in areas such as e-commerce, intellectual property, and innovation, paving the way for a more sustainable and resilient economy.
Thailand’s active pursuit of free trade agreements encapsulates its commitment to expand trade, attract investment, and promote economic recovery. By engaging in bilateral and multilateral FTAs, Thailand aims to enhance its competitiveness, increase market access for businesses, and capitalize on emerging opportunities in the global economy. These agreements play a crucial role in positioning Thailand as a key player in the international trade landscape.
