Reflections on the Human Condition - Api-fellowships.org

Thailand has been the most intensive developing
countries in Asia region to promote its international
trade since this country has been involved in FTA
agreements with other countries. The opening up of
bilateral FTA is directed to liberalize trade in goods
between the two countries that would benefit Thailand
in terms of increased access in the counterpart’s markets.
More details on how this country recently manage and
has deals with its trading partners are summarized as
follows:
• China: Thailand’s FTA with China is special as
the trade agreement between Thailand and China
has been set up under ASEAN-China relationship
and also under Thailand-China agreement.
Under the agreement between ASEAN-China,
the nations agreed to reduce tariffs of imports on
agricultural products. Thailand also signed a closer
economic relation agreement with China under
the Early Harvest Program (EHP). This program
incorporated the tariffs reduction on vegetables
and fruit and started in October 2003. The special
early harvest scheme has resulted in the lifting of
tariffs in both countries (it was about 60 percent
approximately for Thailand and from 28.7 to 63.8
percent for China). 17
• Bahrain: Signed agreement on Closer Economic
Partnership (CEP) in 2002. Negotiations over a
Thailand-Bahrain free trade agreement would be
completed in 2005.
• India: The agreement was signed in October
2003, with full liberalization by 2010. This
agreement is under EHP on the specific items
and started in September 2004. With India, both
countries agreed to reap an early harvest programs
by progressively reducing tariff for 84 products
covering food, fruit, canned food, plastic pellets,
furniture and auto parts. Under EHP, tariffs will
be gradually cut over three years-by 50 percent
this month, 75 percent next year and until tariffs
are eliminated in the third year. The final year of
eradicating all tariffs is year of 2010. Service and
investment liberalization are subjects to further
negotiations.
• Peru: Talks on the CEP agreement was held in
2003 to eradicate tariffs to be zero by 2015.
• Australia: Negotiations was completed and signed
in 2004. The FTA with Australia covered all
sectors and services such as goods, services, trade,
intellectual property and trade facilitation. It mostly
covered dairy products. The Thai-Australian FTA
is the first agreement Thailand has ever reached
with a developed country. The Thai-Australian
FTA, would take effect on January 1, 2005.
THE STATE, DEVELOPMENT AND GLOBALIZATION
245
• New Zealand: Joint study completed and other
round of deals scheduled in 2004. Then, the CEP
agreement was signed in 2005. According to the
free trade agreement, New Zealand will eliminate
duties on 5,878 Thai products, while Thailand will
do the similar way for 2,978 imported products
from New Zealand. New Zealand will write off
duties on other 697 items by 2010, and on 858
products on the sensitive list including textiles,
clothing and shoes by 2015. Thailand will cut
import levies on 1,961 remaining products within
five years, while duties on 520 products on the
sensitive list, such as cow milk and butter, will be
abolished by 2015.
• Japan: Latest negotiation round concluded in
Tokyo in April 2004. Right now is still in intensive
negotiation between the two countries. Thailand’s
FTA with Japan is based more on the strategic
relations than on economic incentives.
• The United States: Negotiations started in June
2004 and expected to continue in 2005. The FTA
covered a range of issues, not only import tariffs
which have been impediments to the flow of trade
in the past, but also the elimination of non-trade
barriers and different sanitary standards. The
US tariffs have been generally low at 7 percent,
compared to 23 percent on average in Thailand’s.
• In addition to these on-going FTA negotiations,
Thailand also has plans to set up a free trade
agreement with other countries such as Pakistan,
South Africa, and MERCOSUR which consist
of countries such as Brazil, Argentina, Paraguay,
Uruguay, and Chile.
In dealing with the trading countries, the Thai
government, under the CEO-style, 18 has run relatively fast
the country to be involved in negotiating and creating
bilateral FTAs. Pros and cons come. Farmers, some
companies and interest groups want to postpone and
reject trade liberalization in order to retain the protection
as long as possible, while, the Thai government will not
be able to keep imposing subsidies or protecting the
industry. In one way, dealing FTA on the fast tracks,
will create more markets quickly to absorb domestic
production of agriculture; but on the other way, the
more unbalance negotiating bilateral trade countries
the more risks in benefiting their society.
As an open developing countries, Thailand should be
aware on its agricultural sector and indeed, its farmers
who are less benefited from trade and commonly
poor. In addition, too many FTA agreements between
individual Asian countries and developed countries will
tend to undermine AFTA goals to realize the free trade
Ref lections on the Human Condition: Change, Conflict and Modernity
The Work of the 2004/2005 API Fellows