Special Report: Thailand and FTA with EU

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Thai PBS has hosted the seminar on the FTA between Thailand and the European Union on 1 May 2011 at Conrad Hotel in Bangkok. The objective of this event was not only to give a general idea of how Thailand could benefit from trades with the EU and stay competitive in the ASEAN region, but also to raise awareness of the issue through Thai media.

Journalists from various networks and newspapers were invited to this event. The Head of the economic and Trade Delegation of the European Union to Thailand, Mr. Antonio Berenguer, explained to the press how the FTA would transform Thailand to be more competitive economically.

Europe represents 1/5 of the world trades and is bigger than the United States and Japan combined in this regard. Mr. Antonio Berenguer said neighboring nations of Thailand like Malaysia and Vietnam have already signed trade agreements with the EU, a step ahead which Mr. Berenguer said was important for Thailand to keep up with the game.

The purpose of the FTA is to reduce tariffs by as much as possible. Since developing nations are able to afford to pay for minimum tariffs on import products, the FTA usually do not allow an absolute exemption. However, the least developed nations like Laos and Vietnam have been given zero tariffs. Over the years, Thailand has had FTA relationships with many trading nations across the globe.

The United States has given the Kingdom GSP treatment in which the country pays lower taxes for its export products. Thailand is also aiming at getting tax reduction from the EU which would help the auto industry in the country.

Among the products exported to the EU, auto parts are by far the largest of all. Some of the agricultural produce have been banned due to traces of chemicals. There are other benefits coming from the FTA with the EU for Thailand as well and that include government procurement which would be bound by the agreements with both partners overseeing the process. This would leave no breeding grounds for corruption. Intellectual property will be made a priority in an attempt to stamp out fake goods. Industries in the country will be more value added rather than industrializing.

The term ‘Globalization’ has never been more significant in its definition than now. With trades opened up between continents, human resources, commodities, knowledge and technologies are now flowing freely in the market. It is this opportunity that Thailand shall take the advantage and strive for better and more beneficial deals.