Thailand halts trade talks until new government

October 11, 2006

BANGKOK (Reuters) — Thailand will suspend all bilateral free trade talks until a new civilian government is elected, Foreign Minister Nitya Pibulsonggram said on Wednesday, following last month’s coup.

"There won’t be any progress on free trade talks until a new government is elected in the next 12 months," Nitya, who resigned as chief trade negotiator with the United States after protests against a pact in January.

The talks between Bangkok and the United States on a free trade pact have been stalled since then after 18 months of on-off negotiations.

The main stumbling blocks at the talks in the northern city of Chiang Mai, disrupted briefly by protesters, were intellectual property and drug patents, liberalisation of financial services and telecommunications.

The United States is Thailand’s largest export market. Thai exports were worth $15 billion in 2004 and imports $7.2 billion.

An almost-finished free trade pact with Japan, which both countries had hoped to sign in July, would also remain in limbo, Nitya said.

"The Japanese government has said it will wait until Thailand has a representative government," said the retired career diplomat, who was also former ambassador to Washington.

Bangkok and Tokyo reached a basic deal late last year after being held up by Japanese insistence that only goods originating in Thailand would be covered.

Japan is Thailand’s second largest export market. In 2004 Thai exports goods to Japan worth $13.49 billion while imports from Japan were worth $22.29 billion.

The government of deposed Prime Minister Thaksin Shinawatra was also working on free trade pacts with China and India.