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Thailand seen missing FTA deal deadlines

Business Times, Singapore

Economy Watch

15 September 2004

Thailand seen missing FTA deal deadlines

Thailand losing momentum in its trade negotiations, says Thai official


THAILAND, the Asian country most aggressive in seeking free trade deals after Singapore, is likely to miss the deadlines for its free trade talks with many nations, including the United States and Japan, according to a senior Thai official.

Pawin Talerngsri, a trade negotiation official in the Ministry of Commerce, said yesterday Thailand is losing momentum in its trade negotiations with the US, Japan, India and Bahrain because of hurdles to market access, complications and politics.

Even in the free trade pact with Australia, inked only recently, Dr Pawin said Thai interest groups representing the country’s dairy industry are placing obstacles in the path of its implementation due next year.

Both the free trade talks with the US and Japan - the world’s biggest and second biggest economies respectively - are expected to drag beyond their scheduled completion dates in 2005, he said at a seminar on trade policies hosted by the Institute of Southeast Asian Studies.

A change in government after the US presidential election in November is only one reason for a likely extension of talks on a US-Thai free trade agreement, according to Dr Pawin. US insistence on the inclusion of labour and environment standards in the talks will also complicate matters further, he said.

As for the talks with Japan, Dr Pawin said Japanese negotiators are already refusing outright market access for Thai farm products and certain Thai industrial goods.

The Thai official also said meeting the 2005 deadline in the Thai-Indian free trade talks is ’unrealistic’, because the Indians are paying more attention to regional trade deals.

And the negotiations with Bahrain, he added, are already slowed down by ’unresolved political issues’.

His report of the poor progress of Thailand’s early efforts in doing free trade deals came a day after trade policy expert Razeen Sally warned at the seminar that Asian nations should think twice about following Singapore in rushing to do free trade deals.

Even as he held Singapore up as a model for such trade agreements, the visiting scholar from the London School of Economics said countries in the region could end up with half-baked deals with little gains, and get entangled in red-tape - if they take the FTA route.

Thailand, according to him, offers an object lesson in how not to negotiate FTAs.

Rather than refuting that view yesterday, Dr Pawin reinforced it by suggesting that Thailand is overtaxing its resources in trying to do too many free trade deals - it currently is talking to eight countries and has set its sights on several more.

He also indicated that Thailand has not given enough thought to and lacked coherence in picking trading partners for free trade deals.