In March 2023, the EU and Thailand announced the relaunch of negotiations for an FTA. To recap, negotiations for an EU-Thailand Free Trade Agreement (FTA) were launched in March 2013 but were put on hold in 2014 following the military take-over in the country. The first round of trade negotiations was held in September in Brussels, while Thailand will host the next round of negotiations in Bangkok in January 2024. The third round would again return to Brussels in June 2024. Thailand and the EU aim to reach a deal by 2025.
The EU aims to publish its text proposals after the first negotiating round and plans to commission a Sustainability Impact Assessment into the possible economic, environmental, human rights, and social impacts of the agreement.
Total bilateral trade between the EU and Thailand amounted to €29 billion in 2020. After China, Japan, and the US, the EU is Thailand’s fourth largest trade partner. On the other hand, Thailand is the EU’s 26th largest trading partner worldwide. Thailand exported goods worth €15.1 billion to the EU in 2020. Key exports are machinery and electronics and transport equipment, miscellaneous manufactured articles, as well as food products. The EU is the second-largest investor in Thailand and also the second-largest destination for Thai outbound capital, accounting for 14% of outward foreign direct investment (FDI).
With the deal, Thailand aims to eliminate tariffs on exports to the 27 countries, particularly automotive parts, electronics, garments and textiles, food, and rubber. In addition, Thailand´s Commerce Minister Jurin Laksanawisit expressed hopes for industrial upgrading: “Investments will be exchanged between the two sides, whereby Thailand will receive technology and innovation transfers that will play an important role in attracting investors from around the world to invest in Thailand.” EU negotiators will aim at increased market access for goods and services and decreased barriers to investment and government procurement processes. Sanitary and Phyto-Sanitary procedures, intellectual property rights, and the removal of obstacles to digital trade and trade in energy and raw materials will be additional priorities of the EU. “Sustainability will also be at the heart of this agreement, with robust and enforceable disciplines on Trade and Sustainable Development […], supporting high levels of protection for workers’ rights, for the environment, and the achievement of ambitious climate goals,” the EU Commission said in a statement.
ASEANcham-EU supports the restart of free trade talks between EU and Thailand, and hopes that both sides will continue to work towards an outcome expeditiously.