An EU-Thailand Free Trade Agreement.

Negotiations for an EU-Thailand Free Trade Agreement were formally launched on 6 June 2013 In late 2013, EABC prepared many detailed policy recommendations and positions specifically focused towards an EU-Thailand FTA.

These negotiations were put on hold by the EU following the 2014 coup.

Following the 2019 Thailand General Election, the EU indicated openness to resuming negotiations, subject to certain conditions being met.

According to reports about a meeting of Minister of Commerce and EU Ambassador on 14^th June 2021, Thailand aims to settle a Joint Understanding Document (JUD) that will be used as a framework for free trade agreement talks expected to begin next year (2022). The Joint Understanding Document will cover trade in goods, trade in services and investments, as well as other areas of interest, such as intellectual property, government procurement and e-commerce.

EABC has been preparing for the re-engagement and will support any initiatives to strengthen EU-Thai trade and investment cooperation.

EABC continually follows up on FTA via both the EU Delegation and Department of Trade Negotiations and through other organisations.

EABCs policy advocacy is found in its European Business Position Papers, the most recent publication 2022, found here, and short summary the EABC Top Set found here.

Benefits of a Thailand – EU FTA. The FTA would make Thailand an attractive destination for a new wave of high-tech investment and enhance the capacity of Thailand’s supply chains to support the manufacturing of advanced-technology products in the future. It is an opportunity for the services sector to be opened which could be an essential aspect of this FTA.

According to the Department of Trade Negotiation (DTN) in the Ministry of Commerce, Thailand has proven itself to be a dynamic force for regional multilateralism through the construction of ASEAN, and more recently through joining RCEP.  The DTN believes that Thailand should be able to continue to shape modern, comprehensive, high-quality, and mutually beneficial trading rules and can play in a global scale with its European partners.

The EU has already concluded FTAs with Singapore and Vietnam, and some other ASEAN member states (eg Indonesia) are in the process of negotiation. Broadening EU’s engagement with Thailand through re-opening FTA negotiations should unlock the great benefits in trade and investment between the two parties.

Based on the study of the Institute of Future Studies for Development (IFD), engaged by DTN a proposed Thailand – EU FTA, there are these indicative benefits:

• A free trade agreement between Thailand and the EU would boost Thailand’s GDP by up to 1.63 %
• Raise imports by as much as 3.42 % per year and exports by as much as 3.43 % per year.
• Investment is also expected to benefit to the tune of 2.74 % per year.
• Household consumption and public welfare could also be boosted.
• Thai products expected to reap benefits include automobiles and parts, garments, electronics, chemicals, rubber, plastic, food and processed food products, machinery and parts, construction and leather products.
• Thai products likely to feel the pinch from the FTA include sugar, vegetables, fruits and beans.
• There are further concerns about the pact’s treatment of alcoholic drinks and medicine and plant varieties.

Timeline of EABC current engagement/update:

For the original EU-TH FTA preparation in 2013, EABC, in collaboration with European Bilateral Chambers collected recommendations and desired outcomes of the European Business Community in Thailand, through the EABC Working Groups, and with JFCCT inputs and inputs from bilateral chambers, covering all relevant topics.

Some more recent events which are shown by associated documents:

1 November 2019: EABC representatives participated in information session and dialogue at the Ministry of Commerce, Department of Trade Negotiations, “Opportunities and Challenges of a possible Free Trade Agreement (FTA) between Thailand and the European Union”.

3 December 2019: EABC submitted a letter to Mrs. Auramon Supthaweethum, Director-General, Department of Trade Negotiations on recommendation of what should be included in the FTAs under discussion.

9 December 2019: EU-ASEAN Business Council submitted a letter to Mr. Peter Berz, Head of Unit, South and South East Asia, Australia, New Zealand Directorate-General for Trade, European Commission on inputs for possible recommencement of negotiations for EU-Thailand FTA.

10 March 2020: EABC representatives had a further dialogue with DTN as a follow up to the 1 November 2019 meeting and EABC letter of 3 December 2019.

End July 2020: Mr. Jurin Laksanavisit, Deputy Prime Minister and Minister of Commerce had a meeting with Mr. Phil Hogan, EU Trade Commissioner in June. The current position from the EU side is ‘Exploratory’ to determine whether the conditions are suitable for an FTA. EUD had advised that detailed input on preferred positions is premature at this stage.  DTN had nevertheless indicated that there.

16 September 2020: Full Research Report: Study of the Impacts of the Thai-EU Free Trade Agreement by Institute of Future Studies for Development (IFD). The IFD study in infographic 

9 December 2020: EABC submitted a letter to Executive Vice President Valdis Dombrovskis, Trade Commissioner, European Commission to prioritise an EU-Thailand FTA discussion.

10 March 2021: The Trade Negotiations Department is scheduled to propose a framework for free trade agreement (FTA) with the European Union (EU) and the outcome of public hearings on the pact’s impact to the commerce minister for consideration early in the second quarter of this year. Source: Bangkok Post

10 May 2021: EABC representatives participated in an interview for Thailand-EFTA FTA Research Project on the impacts of the Thailand-EFTA Free Trade Agreement organized by the Institute of Future Studies for Development (IFD). This is separate to a Thailand – EU FTA.

EABC maintains meeting notes of the 1 November 2019,  10 March 2020 meeting with DTN, and the interview about EFTA interview on 10 May 2021.

20 August 2021: EABC representatives had a follow up dialogue with Mrs. Auramon Supthaweethum, Director-General, Department of Trade Negotiations to update on EU-Thailand FTA development. This discussion included; an update on EU-Thailand FTA explorations, current development relevant to a Joint Understanding Document (JUD) and EABC proposals based on expected chapters in an EU-Thailand FTA.  Please see a short summary of the event here and the relevant materials for this meeting directly below.

30 August 2022: EABC representatives participated in a seminar on “Keeping Pace with the EU’s New Trade Policy and Rules” organised by Department of Trade Negotiations (Ministry of Commerce) to raise awareness and understanding of the new European Union’s trade-related legislation and regulation, such as the due diligence duty, deforestation-free products, eco-design for sustainable products, and new rules on single-use plastic products, in order to promote an open and robust business climate between Thailand and the European Union.

14 December 2022: Thailand and the European Union (EU) have signed the Thai-EU Partnership and Cooperation Agreement (PCA) to boost bilateral cooperation. See downloadable description below.

15 March 2023: The EU and Thailand announced the relaunch of negotiations for an ambitious, modern and balanced free trade agreement (FTA), with sustainability at its core. This announcement confirms the key importance of the Indo-Pacific region for the EU trade agenda, paving the way for deeper trade ties with the second largest economy in South-East Asia and further strengthening the EU’s strategic engagement with this burgeoning region. More details in the press release.

18 September 2023: First round of negotiation in Brussels. More details in EU-Thailand FTA first round report and EU website.

EABC Survey: EABC offers our  members the opportunity to be heard directly via a survey on the expected EU-Thailand FTA. To download the survey report: “Expectations and Challenges of an EU-Thailand Free Trade Agreement (FTA): Perspectives from European Business in Thailand.”

EABC has been building capacity and preparedness for some time in preparation for an EU-Thailand FTA. EABC has started preparing positions and recommendations based on expected chapters in an FTA. For engagement please be in touch with EABC: [email protected] 

DTN website: https://www.dtn.go.th/en/page/item/index/id/24 

EU website: https://policy.trade.ec.europa.eu/eu-trade-relationships-country-and-region/countries-and-regions/thailand/eu-thailand-agreement_en