Thailand and Turkey are studying the possibility of a bilateral free-trade agreement not only to enhance trade and investment between the two countries, but also to use each other as regional springboards - into Asean on one side, and into the European Un
Thailand recently hosted a second Joint Working Group (JWG) to look into the feasibility of such an FTA.
Nisa Srisuworanant, deputy director-general of the department, said the study should conclude this year whether Thailand and Turkey will start FTA negotiations in the near future.
“Both nations are agreed that the FTA will increase trade and investment opportunities for both sides. Thailand could also be a gateway for Turkey to Asean markets, while Turkey, which is under the European Union’s Customs Union and is strategically located close to the Balkans and the Middle East, could be a springboard for Thailand to penetrate those markets,” Nisa said.
She said that after the feasibility study is completed this year, policy-makers for both countries would make a final decision on whether to start the negotiations officially.
According to Thailand’s Fiscal Policy Research Institute Foundation in cooperation with the Economy Ministry of Turkey, Thailand would reap the most benefits from the FTA, particularly in growth of gross domestic product, investment, and employment. Thai exports that would benefit include foods, plastics, refrigerators, auto parts, rubber and products, and garments.
Turkish products that would enjoy higher exports to Thailand are marble, jewellery and ornaments, garments, and automobiles.
Turkey is one of the most interesting markets for Thailand as it has a relatively high population of 80 million and has strategic links to Europe, Asia and Russia. Turkey could be a springboard for Thailand to penetrate the EU, Eastern Europe, the Middle East, Africa, and Balkan countries.
Currently, Turkey is Thailand’s 39th-largest trading partner, and seventh among countries in the Middle East. For all of the past five years (2009-2013), Thailand has had a trade surplus with Turkey. Last year, trade between the two countries was valued at US$1.43 billion (Bt46.3 billion), up by 8.19 per cent from 2012. Exports from Thailand to Turkey were worth $1.11 billion, and imports to Thailand $318.6 million. Thailand thus enjoyed a trade surplus of $880.92 million.
In the first four months of 2014, two-way trade was $480.35 million, down by 7.13 per cent year on year. Exports dropped 8.18 per cent to $381.24, while imports decreased 2.84 per cent to $99.11 million.
Major export products from Thailand to Turkey included air-conditioners and parts, automobiles and parts, plastics, rubber products, rubber, yarn and polyester, jewellery and ornaments, computers and parts, and refrigerators and parts.