Big business buoyant on EU free trade deal

Big business buoyant on EU free trade deal

Business operators see a promising trade outlook following a decision by foreign ministers of the European Union to resume political contacts with Thailand including free trade agreement (FTA) negotiations.

Poj: Fishing policy to benefit

But FTA Watch has warned the nation may be disadvantaged by the trade deal.

The Foreign Affairs Council of the EU resolved on Monday to resume its political ties with the kingdom.

The Foreign Ministry yesterday said the government welcomes the decision and is gratified by the council's appreciation of the constructive role Thailand plays as the official coordinator of Asean-EU dialogue relations.

The government will foster stronger relations between the EU and both Asean and Thailand on the basis of mutual respect, mutual benefits and a long-lasting partnership, it said.

Prime Minister Prayut Chan-o-cha also welcomed the EU's decision, calling it the result of concerted efforts to convince the bloc that the regime has been working in the best interests of the nation since it seized power in a coup in 2014.

"They [EU] did not set any conditions. They only want Thailand to return to democracy via a creditable election," Prime Minister Prayut Chan-o-cha said.

Gen Prayut said the EU has asked him about his pledge to hold elections in November 2018 and he replied that he has never backtracked on his time frame for the election roadmap.

Poj Aramwattananont, president of the Thai Fishery Producers Coalition, said the EU's decision would further benefit Thailand in regard to illegal, unreported and unregulated (IUU) fishing, for which it has been censured by the European bloc.

"The resumption of talks will trigger a good response on IUU issues in the future," he said.

Experts believe the EU's move boosts the country's chance of seeing off the "yellow" warning card which the European body imposed in April 2016 after Thailand failed to properly address illegal fishing practices.

Wisit Limluecha, vice-president of the Thai National Shippers' Council (TNSC), said the exports and trade should also benefit.

"Thailand's exports to the EU have lost the benefit of low-import tariffs via the GSP [Generalised System of Preferences] for a long time. We hope the resumption of ties will restore this for Thai exporters," he said.

Thanavath Phonvichai, an economist at the University of the Thai Chamber of Commerce (UTCC), said Thailand's image will also get a boost.

"The EU has sent a signal to the world that Thailand has set a clear road map for the general election, and that will boost confidence among foreign investors," he said.

Activists who are monitoring the bilateral trade deal cautioned Thailand could suffer.

"Thailand will gain its old GSP. But the EU will get long-term benefits, especially on intellectual property and patents for pharmaceutical products, more open access to government procurement, and more protection on foreign investment," said Kannikar Kijtiwatchakul, co-founder of FTA Watch.

The government could also face more lawsuits if it hastily cancels foreign investments especially those with clear benefits for the public, she said.

She cited the case of Akara Resources' gold mine. Its parent firm, Australia's Kingsgate Consolidated Ltd, threatened to sue the government in an arbitration tribunal for violating the Thailand-Australia FTA after Bangkok ordered the suspension of gold-mining operations nationwide.

"Our government may face constraints when issuing policies such as censoring photographs on cigarette packages or imposing local controls on the sale of alcohol because foreign investors might look at these terms as unfair and seek international trade disputes," she said.

"We [FTA Watch] do not counter free-trade negotiations. What we worry about is the lack of transparency surrounding the trade talks," she said.

Civil society groups and the consumer sector are not well-informed under the current regme, she added.

"In democratically-elected governments, civil society was always updated on the progress of state FTA negotiations and idea-sharing was allowed. But now, only investors get that information."

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