AS ONE of the 12 signatories to the Trans-Pacific Partnership, New Zealand suggests that Thailand should consider joining the TPP during the public scrutiny process by member states, arguing that the partnership will be the world's largest trade agreement
In an exclusive interview with The Nation, New Zealand’s ambassador to Thailand, Reuben Levermore, said that since Thailand was such a strong trading nation and heavily reliant on exports, which account for 70 per cent of its gross domestic product, joining the TPP would increase trade opportunity and ensure the country’s future growth.
“We [New Zealand] see the opportunity from the TPP, as it includes many large markets, mainly the US and Japan, and other countries. For Thailand, I think the opportunity is also waiting for the country to see the [benefits of the] agreement, as all TPP members will need to go through the public scrutiny process and get parliamentary approval. Thailand can take this chance to study and see the details of the agreement, and consider whether to join the TPP,” said the ambassador.
Although Thailand is moving forward to membership of the Regional Comprehensive Economic Partnership (RCEP), which will have 16 member countries – 10 Asean members, China, Japan, South Korea, India, Australia and New Zealand – the RCEP cannot compensate for non-participation in the TPP, whose market size and combined GDP are much larger, he said.
Thailand should consider joining every trade agreement possible, as it is important to benefit from the different angles offered by each pact, and it would help open up opportunity for the Kingdom to increase market access to all, he added.
Levermore believes that following the TPP’s implementation, the combined trade of its member economies will double.
Asked about concerns over the opening up of service or other sectors under the TPP, the ambassador said that these should not be seen as major issues since the TPP would help enhance closer cooperation and develop sectors in which there were different playing fields.
For instance, New Zealand has strengths in service businesses such as education and IT, and cooperation under the TPP should help promote those sectors’ growth into other markets, while other service businesses will need more investment from other countries to help develop their growth.
Meanwhile, in regard to bilateral trade between Thailand and New Zealand, Levermore said that almost 10 years on from the implementation of their free-trade agreement, he expected there would be a revision of the FTA to promote more trade and investment growth on both sides, as well as leveraging closer cooperation in many sectors.
He explained that certain specific issues needed to be discussed, such as the liberalisation of service business to allow more foreign ownership, and facilitation of the movement of professionals so that Thai service businesses can be upgraded, which would improve the value chain.
New Zealand’s special agricultural trade envoy, Mike Petersen said that under the bilateral FTA, he expected that Thailand and New Zealand would tighten their cooperation in many sectors, particularly in agriculture as New Zealand has high expertise in the industry.
He said many New Zealand businesses would like to trade and invest more in agricultural business with Thailand in the form of joint ventures or trade partnerships.
Since New Zealand has high expertise in five key agricultural sectors – dairy products, beef, sheep, farming and wine – the country foresees closer cooperation with Thailand, as well as more trade and investment for both sides, he added.
New Zealand could also help transfer technology and know-how in quality agricultural production, and improve capacity for Thai farmers, which would in turn increase consumer satisfaction, said Petersen.
Talking about the dairy sector, in which New Zealand has a particularly high level of expertise, the envoy said the country could transfer technology and innovation, which would help Thai dairy farmers upgrade their production standards. Thai dairy farmers should take the opportunity of the FTA to develop their production rather than simply worry about market liberalisation, he suggested.
Under their FTA trading target, Thailand and New Zealand pledged to double commerce between the countries to Bt100 billion by 2020.
Bilateral trade amounted to about Bt60 billion last year.