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Published on January 31, 2008

Economics guru Ammar Siamwalla warned yesterday that Thailand should not embark on further free-trade talks with the US, because studies had shown such a pact would "wreak havoc" in Thailand and unbalance economic issues between the two countries.

Speaking on the sidelines of a seminar entitled "Measures to Reduce Impacts from a Thailand-US FTA: A Case Study on Agricultural Goods and Patents," Ammar said he had not seen any benefits to be gained from the proposed bilateral trade pact.

A study conducted by the Thailand Development Research Institute (TDRI) has shown Thailand risks losing out in the area of intellectual-property rights, while the Kingdom will not enjoy high benefits from agricultural trading as some proponents of the FTA suggest.

"Thailand is not ready to reopen bilateral talks with Washington. The results of the study show there will be fewer benefits for Thailand than suggested. The Thai government does not have to move on the negotiations," said Ammar, who is honorary adviser to the TDRI, a position he also held for the former National Legislative Assembly.

TDRI research director Somkiat Tangkitvanich said he believed there would not be a bilateral FTA agreed between Thailand and the US within the next few years.

The situation has changed over the year in which the talks have been suspended. Thailand has not only new regulations for receiving parliamentary approval for international trade deals, but also a new leader.

Any new initiatives to proceed with an FTA with the US should come under a regional trade pact, such as one negotiated by Asean or Asia-Pacific countries, he said.

TDRI research specialist Jirawat Panpiemras said Thailand should not pursue the US FTA, particularly as it concerned drug patents and protection of plant varieties.

If Thailand agreed to include patents in the deal, consumers would have to pay more for patent drugs, because the US would be able to extend the period over which its patents were valid, he said.

Jirawat said the US was likely to ask Thailand to become a signatory to a convention on new plant varieties under the 1991 International Convention for the Protection of New Varieties of Plants. Essentially, the treaty assigns patents to new plant species, allowing the developers of the plants to charge royalties for their use, and Thailand is not ready to be a party to such an agreement.

Another TDRI researcher, Worawan Chandoevwit, said Thailand risked losing out on agriculture.

A few products, including rubber, tropical vegetables, fruits and rice, would benefit from a free-trade deal, he said, but many others risked losing out, because the US had higher agricultural development and provided subsidies to help its farmers. Products that would lose out included fuel crops like soybean, cotton, corn, sugar cane and tapioca.

Board of Trade deputy secretary-general Pornsilp Patcharintanakul said businessmen wanted an FTA with the US. The government should be working on measures to reduce undesirable effects from such a deal, because trade liberalisation was inevitable.

Petchanet Pratruangkrai

The Nation