Thai - US Free Trade Agreement, Examining the Hurdles Both Countries are Facing
By: Peter Kopitz
A long road still lies ahead for the Thai-US trade talks. But there are still a few very sensitive unsolved issues on the table that need to be resolved, as nether side wants to expose some key domestic industries to their competitors.
Thailand supposed to open up its heavily protected banking sector, which includes commercial banking, stock brokerage, and the insurance industry. But most companies in the banking sector are reluctant to a quick change, and prefer a slow opening of the industry.
On the other hand, the United Auto Workers Union is afraid of opening up their sector to Thailand, as the US faces pressure to drop its tax on imported pickup trucks. Thailand, building more than 500,000 pickups a year, is the worlds second largest pickup manufacturer, but none of these cars are exported to the United States at the moment.
With over $65 million people and a current GDP of $180.9 billion, Thailand is an important strategic partner for the United States, especially since China is increasingly challenging US economic policies in the region.
Thailand has already a FTA with Japan, taking effect later in 2006, and is also negotiating with several other nations regarding similar arrangements.
In the long term, Free Trade Agreements are a vital part of the future growth and success of an economy. It is true that liberalization increases competition, but it should be seen in a positive way, as it forces companies to become more efficient and cost effective to stay ahead in a highly competitive and fast paced environment.
Peter Kopitz is currently living in Bangkok, Thailand after graduating with Honors from the University Of Chicago Graduate School Of Business with a Masters Degree in Business Administration. He is actively involved in researching economic and political development in Thailand, focusing primarily on property development, security analysis and investment banking. Hawaii Home Loans | Honolulu Realtor | Hawaii Rentals