Focus on Trade #109, Focus on the Global South
THAILAND-US FREE TRADE AGREEMENT: "WHATEVER WE HAVE TO SACRIFICE MUST BE SACRIFICED, IF THAT HELPS GET A BETTER DEAL."
By Sajin Prachason*
THE third round of Thailand-US free trade agreement (FTA) negotiations ended on 8 April with great disappointment for civil society activists because people’s demand and concerns were cast aside.
After a brief delay in the talks last year, the negotiations between Thailand and the US resumed at full steam after the ruling Thai Rak Thai Party won a landslide victory in the national election in February this year. The new round of negotiations took place 4-8 April 2005 in an isolated but luxurious hotel on the cliff overseeing the beach in Pattaya. Of the twenty-two issues on the table, intellectual property rights (IPR) was of greatest concern to farmers, patients, academics, NGOs and other civil actors. Following the model of the FTAs agreed with Singapore, Australia and Chile, the US was expected to aggressively demand the protection of IPR beyond that required under the Trade Related Intellectual Property Rights agreement (TRIPs) in the WTO. This would have a devastating impact on people’s lives and millions of family farms in the country by the intensification of control on drugs and seeds, not to mention other commodities, by the US-based transnational corporations.
WELCOME TO AMAZING THAILAND!
Thailand is no Japan. In the Thailand-Japan FTA negotiations, Japan stands firm on protecting their most politically sensitive sector, agriculture. Thailand, in contrast, is willing to put everything, no matter how sensitive it is, on the table, and only then modify the proposal according to the ability to negotiate. There is no tough stand or position on what should be in or out of this project of trade expansion. For Thailand, everything is negotiable.
The FTA talks with the US are highly asymmetric in both political and economic power. Despite this, the Thai government and the negotiating team chose not disclose crucial information and asked people to trust them for they hold the "best interests of the country in their hearts". In fact, the head of the negotiation team, Mr Nitya Pibulsongkram, was a former Ambassador in Washington. His experiences in the US should have made him realize how the terms of this trade game are established and how Thailand would fare in the negotiations. Unfortunately, what he told the public later — that "finally, whatever we have to sacrifice must be sacrificed, if that helps get a better deal" — simply showed that Thailand had surrendered to the US’s rules of the game and raised a big question of who decided what is best for whom.
Therefore, before the negotiations took place, groups of civil society marched on the street and submitted a letter to the head of the negotiating team. They demanded IPR out of FTA and that people should participate in the process. Sadly, although their voices were loud enough to be heard, it fell on deaf ears. Instead, the people’s action was portrayed as "not constructive and over-reacting". As the authorities explained, "this meeting, despite reaching the third round, is simply a forum for information exchange between parties, not to conclude the agreement". Such a response was a blatant attempt to reduce peoples’ concerns to a technical problem and an implicit refusal for public participation in the FTA negotiation.
When the free trade talks officially commenced on the 5 April, over a thousand people took to the streets, marching to the hotel where negotiations were taking place. Although the demonstrators could reach the hotel doors, it was still too far for the participants (and, of course, hotel guests) to realise what was going on outside the building. After a discussion with the police and representatives of the Thai negotiating team, fifteen representatives of the demonstration were later invited to discuss with the Thai team in the hotel. Forty-five minutes of meeting was, however, another disappointment: "We are just the negotiators, not the decision-makers," they said. "If we take IPR off the table, the US will do the same with other issues".
OH, THAILAND...THANK YOU FOR YOUR STUPIDITY
"Even without FTAs, Thai people are already consuming expensive medicines" is one of the arguments used by the Thai negotiators in an attempt to convince the public that the FTA with the US is irrelevant to the higher prices of medicines. Perhaps they do not know that the underlying reason is that Thailand has already succumbed to pressure from the US to extent the drug patent protection period from 15 years to 20 years (as stated in the TRIPs) eight years ahead of the deadline set by the WTO. That is, Thailand has already exceeded its TRIPS obligations in the face of US pressure. While other developing countries took the extra time to develop and strengthen their own pharmaceutical industries, Thai people were forced to buy expensive patent drugs since 1992, and domestic industries have been limited in their growth and capacity to provide more affordable alternatives. As a result, it is not surprising that drug prices remain high, even "without FTAs"
During the past few months, the US has used several tactics to calm down the pressure against the proposed FTA. The Embassy in Bangkok approached a number of civil organisations and offered a meeting with them but insisted that no press be involved. An informal meeting organised by the USTR (United States Trade Representative) on the 5 April confirmed a belief among civil society that people’s lives were not and would not be considered as essential in the FTA with the US. It seemed that the sole purpose of the meeting was to persuade and propagandize how Thai people would benefit from agreeing on IPR with the US.
The whole process of launching, negotiating and concluding FTAs in Thailand is entirely detached from democratic values. The parliament is neither consulted nor required to approve FTAs. Nor is the idea of people’s participation seriously encouraged. The outcome of the FTA talks is left in the hands of a few people in the government and carried out in a closed negotiation room. Until now, the expected benefits from the FTA with the US are not clear. US investors have enjoyed a privilege over other investors during the past 37 years through the Treaty of Amity but now they are demanding even more liberalisation. In contrast, in agriculture, where Thailand has an advantage, the issue of US agricultural subsidies, which leads to price decline in the world market, is not included in the discussion. The FTA with the US cannot mean anything except deepening the US and its multinational corporation’s domination in the country. Unfortunately, the Thai government keeps silent and is chronically deaf to people’s worries.
The third round of FTA talks between Thailand and the US is over. It was the first and would also be the last meeting to be held in Thailand as future talks are set somewhere else. This means the rest of the talks could be done more easily, far from public pressure. The outcome of the negotiation in Pattaya did not result in any significant changes. The US said they were satisfied and ready to make a move in the next meeting during July-August. The Thai negotiating team repeated their argument that no agreements or commitments on any issues will be made until a later date. And IPR is still on the list. The only modification is one additional sentence about "respecting the Doha Declaration", which is entirely inconsistent with the act of putting IPR on the FTA table at the first place.
Peoples’ participation is essential. Thailand cannot be a democratic country if its people are not allowed to take part fully in economic decision-making, particularly in a mega plan like FTAs, which creates a few winners but many losers. It is not enough to assess the "benefits" of an FTA solely on the basis of competitiveness in the private sector without regard to the overall social, cultural and environmental impacts. In response to mass opposition to FTAs with the US and Japan, the Thai authorities proposed to establish a complaint and information centre, showing their misplaced belief that people’s participation can be done through a "technical fix". In contrast, genuine people’s participation in the FTA negotiation must be realized at the political, policy and practical levels. All sectors must be equipped with information and allowed to debate on significant issues because Thailand is not a company and the right to govern belongs to everybody.
* Sajin Prachason is a research associate with Focus on the Global South.