Thailand poised to cash in on historic WTO deal: KRsearch
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A HISTORIC World Trade Organisation deal that will abolish developed countries’ subsidies on agricultural exports for developing countries by 2018 could benefit Thailand’s economy because of a consequent increase in fair trade, said the Kasikorn Research
The agreement will not affect Thailand’s policymaking at the moment as it will not come into effect until the end of 2018 and the Kingdom currently has no export-subsidy policy for agriculture products and prices.
Pimonwan Mahujchariyawong, deputy managing director of KResearch, said the developing countries receiving subsidies would be affected but the deal would open up more competition, and Thailand was well placed to compete for greater market shares.
“These export-subsidy measures involve the distortion of agricultural prices by selling the products for less than the market price, and Thailand does not have such a measure in place,” she said.
WTO member countries agreed to abolish agricultural export subsidies after five days of talks in Nairobi, but failed to make progress on the long-stalled Doha Round of negotiations aimed at lowering global trade barriers.
The 162-member body, meeting in Africa for the first time, reached the agreement on Saturday, with developed nations committing to removing their subsidies immediately.
In a statement, WTO director-general Roberto Azevedo hailed the agreement as the “most significant outcome on agriculture” in the organisation’s 20-year history.
Pimonwan said current government measures to support Thai farmers hit by the global drop in agricultural prices and drought, such as various loans and cash handouts, did not affect export prices and thus the Nairobi deal would not affect on measures to support farmers.
She said the effect on the world’s trade of agricultural products would depend on the conditions that came with the deal, including whether it would be a complete abolition of subsidies or whether they could be allowed under certain conditions.
“We will have to wait and see if the Thai sugar industry’s grading of the sugar into three grades will be affected by the new WTO deal, as this will depend on the conditions and the details of the deal,” she said.
Commerce Minister Apiradi Tantraporn said Thailand, as the world’s leading rice exporter, should benefit from the agreement in the long run.
