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Tough going on services, agriculture in Thai-US free talks

MCOT News, Thailand

Tough going on services, agriculture in Thai-US free talks

12 January 2006

CHIANG MAI, Jan 12 (TNA) - Thai and United States negotiators have failed to make any headway towards a pact on liberalising trade in services under the broader Thai-US Free Trade Agreement (FTA) negotiations, according to Thai industry observers.

Nilsuwan Leelarasmi, vice-president of the Federation of Thai Industries (FTI), said the two sides were still far apart and there was no sign of an agreement.

He has been monitoring the current talks on the services industry on behalf of the Thai private sector.

Mr. Nilsuwan said the US wanted Thailand to improve standards for both service providers and the service themselves, as well as the legal framework for the overall services sector.

But as US standards were far higher and stricter, it would take Thailand up to 10 years to get a compatible legal framework in place, he told journalists after the meeting.

Paibul Palasuwanna, secretary-general of the Thai Shipping Association, said in a submission to FTA negotiators today that Thai shippers wanted the FTA agreement to play a role in transferring US logistics know-how to Thailand in the form of university curricula, training and joint ventures.

This would help realise the Thai government’s policy of cutting the high logistics cost born by Thai industries by five per cent within five years, he said.

Talks on the agricultural goods sector also remained in flux, as the two sides said they would exchange a list of goods eligible for tariff cuts in February.

In this sector, US had a trade deficit of up to 100 million dollars, with Thailand exporting 670 million dollars and importing 570 million dollars worth of US farm products.

However, Vice Commerce Minister Uttama Sawanayon said the US had made a tentative agreement to open up its market to an additional 500 million dollars worth of Thai farm products by bringing tariffs down to zero within five years after the implementation of the FTA.

Key beneficiaries among the 1,300 items of goods in this category would be rice and rice products, and processed food .