The Commerce Ministry is speeding up free trade talks with key trading
partners as Thailand risks losing exports and direct investments from Europe as
the euro-zone debt crisis drags on.
Srirat Rastapana,
director-general of the Trade Negotiations Department, said Thailand will enter
talks on a Regional Comprehensive Economic Partnership (RCEP) early next year
if the framework is endorsed by leaders at November's Asean Summit in Cambodia.
What is billed as a
"second-generation free trade agreement" will cover Asean+6 _ the 10
Asean members plus trading partners Japan, China, South Korea, India, Australia
and New Zealand.
Their combined population of 3.2
billion is much larger than Asean's 601 million.
"We want the RCEP to take
effect in 2015, the same year as the Asean Economic Community kicks off,"
Mrs Srirat said yesterday on the sidelines of an AEC seminar co-hosted with the
Federation of Thai Industries.
Addressing the forum, Mrs Srirat
said European companies are the largest foreign investors in Asean and rank
second in Thailand after Japan.
The euro-zone turbulence will
likely affect not just Thailand's Europe-bound exports.
"The economic slowdown may cause
European companies to downsize their investments in Thailand or move to
lower-cost countries in Asean. This will affect not only employment here but
also technology transfers from Europe to Thailand," said Mrs Srirat.
The US economy, which accounts for
10% of Thai exports, is expected to shrink further, while the Japanese economy
remains stagnant.
These factors pose big problems
for Thailand, said Mrs Srirat.
Apart from the RCEP, the
department is speeding up ongoing FTA negotiations with India, Chile and Peru
with an aim to concluding all three pacts this year.
It is also set to resume talks
with the US trade representative in October about the the US-backed
Trans-Pacific Partnership, which involves nine countries to date.
Ms Srirat also called on Thai
companies to expand to other Asean countries in clusters to reap the benefits
of regional economic integration.
Krisda Monthienvichienchai,
president and chief executive of the Mitr Phol Group, said the world's
fifth-largest sugar exporter has expanded to Laos, Cambodia, Myanmar and China
due to Thailand's limited human resources and a lack of available land.
Half of Thailand's 110 million
rai of farmland is rice paddy, while only 8 million rai is planted with sugar
cane.
Mitr Phol operates on 2 million
rai, of which 1% is its own land and the rest contracted.
Some neighbouring countries have
also granted sugar production investment incentives that are not available in
Thailand.
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