The negotiations about a free trade agreement (FTA) between Thailand and the EU came to a halt five years ago. After the 2014 coup and the introduction of the military rule, the EU discontinued negotiations to protest the suspension of democracy.
Now, both parties are returning to the negotiation table. Thailand’s main objective is to gain more convenient access to the European market by reducing and eliminating trade tariffs. On the other hand, the EU wants access to local medicines, cars, and alcoholic beverages and wants Thailand’s service sector to open up through the FTA.
Currently, all Thai export products are subject to EU tariffs. Therefore, an FTA would help Thai exporters, especially considering that two-way trade between Thailand and the EU rose by 6.5% last year and now amounts to US$ 47.3 billion.
EU and Thai companies would benefit from FTA
According to the EU-ASEAN Business Sentiment Survey, EU companies view ASEAN as the region with the best economic opportunities in 2019. That’s why 94% of EU businesses urged the EU to accelerate trade negotiations with ASEAN nations.
After negotiations with Thailand have come to a halt, the EU pursued other agreements and closed an FTA with Singapore and Vietnam. “Development in ASEAN must start first with the group’s top countries, Singapore and Vietnam,” said Pirkka Tapiola, EU ambassador to Thailand, “and I hope we will be able to continue trade negotiations with Thailand.”
He remains “optimistic” regarding the outcome of such negotiations, as both sides can benefit enormously. The EU is both Thailand’s and ASEAN’s third-largest trading partner, and a top investor in ASEAN.
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