Free-trade pact talks with EU will be sped up, Kittiratt says

Asia and Europe should work closely to enhance cooperation on investment and trade, Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong said yesterday at the close of the 10th Asia-Europe Finance Ministers’ Meeting. 

He said that ministers had a consensus to promote economic development to enhance trade and investment facilities. 

He recounted mistakes made by many countries in the 1930s, when, instead of promoting trade and investment, some economies decided to adopt protectionism. So that strategy wasn’t welcome.  

“We all agree and hope for higher trade and investment among ourselves within the region and also between the two regions,” Kittiratt said. 

Thailand would accelerate trade negotiations with Europe as these had been long delayed, mostly by Thailand. 

He said the Commerce Ministry would outline the scope of trade negotiations with Europe in the next few months and submit it to Parliament for approval. 

After, the government would dig into details how to liberalise trade and investment with Europe and submit the final pact to Parliament for approval. 

He conceded the government had made slow progress in talks not only with Europe but other trade partners also, including countries in South America.

Vice president of the European Commission Olli Rehn said Europe was fully committed to further develop trade and was also a major export market for Asia. Currently Europe was engaged in a highly ambitious programme of talks with trade partners in Asia and believed there was still untapped potential in some sectors, he said. 

He said he agreed with Kittiratt and other ministers that “we need to fight protectionism and work toward free trade”. He said there was a need to conclude the Doha trade round under the World Trade Organisation multilateral talks. 

Meanwhile, deputy managing director of the International Monetary Fund (IMF) Naoyuki Shinohara said Thailand and other emerging markets in Asia could not escape the potential negative impact of the United States falling off its fiscal cliff and the deepening debt crisis in Europe. Despite Asia having space to use monetary policies to buffer the negative economic impact, it had to be aware of the risks created by trade links and volatile financial and commodity markets. He said Asia must focus on balancing inflation and domestic demand.

As for efficiency of the European Central Bank’s ESM measures to tackle the debt crisis, Naoyuki echoed the words of IMF chief Christine Lagarde, who said more time needed to be given for troubled economies to recover. He said countries struggling with political conflicts may take up to two to three years to recover from their economic downturn.