Use of FTA allowances persists, falls in value

Use of free trade agreement (FTA) privileges by Thai exporters remained high in January amid the global economic crisis and a stronger baht.

The Ministry of Foreign Trade reported yesterday that Thai exporters used FTA privileges for US$5.39 billion, with ASEAN, China, Australia and Japan topping the list.

Nonetheless, the value is down 16.1 percent from January last year, when the use of FTA privileges amounted to 71.7 percent in January this year.

In 2022, the amount of preferential free trade agreements used by Thai exporters will surge to US$84.6 billion, a year-on-year increase of 10.9%, and the utilization rate is 82.1%.

Ronnarong Phoolpipat, director-general of the Ministry of Foreign Trade, said the high FTA privileges used in many agreements apply to trucks transporting goods weighing less than 5 tonnes, sugar, synthetic rubber products, fresh durians, cars and other diesel vehicles or semi-diesel engines, and capacity For 2,500 cubic centimeter trucks.

Thailand has signed 14 free trade agreements with 18 countries, including the Regional Comprehensive Economic Partnership, which came into effect early last year.

However, the use of the aforementioned FTA privileges excludes the Thailand-New Zealand FTA, which requires a self-declared certificate of origin, and the ASEAN-Hong Kong FTA, under which import duties on most Thai products are covered by the agreement.

The main products that saw an increase in exports last year included freight vehicles, fresh durian and chicken.

Auramon Supthaweethum, director of the Trade Negotiation Department responsible for FTA negotiations, recently announced that Thailand has set its sights on starting FTA negotiations with the European Union (EU) this year and speeding up the completion of negotiations on plans to cooperate with the European Free Trade Association (Efta) , Canada, Turkey and Sri Lanka signed a free trade agreement.

According to Ms Auramon, her ministry’s negotiating plans for 2023 will focus primarily on the launch of Thailand’s FTA negotiations with the EU; the conclusion of talks on the four pending agreements with EFTA, Canada, Turkey and Sri Lanka; and New Partner conducts research on the possible benefits and impact of a potential free trade agreement.

Negotiations on a free trade agreement with the EU were stalled after a 2014 coup as the bloc protested what it saw as a suspension of democracy.