TPP and RCEP ‘will be good for Thailand’

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TPP-RCEP
TPP and RCEP ‘will be good for Thailand’
Nophakhun Limsamarnphun
The Nation


Joseph Incalcaterra

BANGKOK: -- Thailand will likely become a member of both the Regional Comprehensive Economic Partnership (RCEP) and the Trans-Pacific Partnership (TPP), as the two pacts are not in conflict, Joseph Incalcaterra, HSBC’s Asean economist and Asean Economic Community (AEC) expert, said.

In an interview with regional media, he said Thailand should benefit from joining both trade blocs as the RCEP's centre points are China, Japan and India, while the TPP is spearheaded by the US and Japan, with Thailand's automotive industry among the potential gainers for exports to the huge TPP markets.

The RCEP is the extended trade bloc of the AEC, with a combined economy worth US$2.6 trillion (Bt83.8 trillion).

Incalcaterra said the AEC, which ushered in a new era at the start of this year, would lead to more effective flows of capital and trade in services, in addition to the freer flow of goods.

However, he said trade in services was more difficult due to non-tariff barriers, but the situation should now continue to improve as member countries hope to achieve their liberalisation goal in 2025.

Within the AEC area, he said, the "single window" facility for cross-border trade had lowered transaction costs, while global supply chains had benefited from cost savings in the area's single production base.

However, the economist said Asean countries needed more political will to further integrate the member states and boost foreign direct investment from outside the region, while implementing structural reforms to boost auto and other industries, as well as infrastructure investment projects using the public-private partnership model.

Regarding the TPP, he said, the 12-nation trade bloc should complement the RCEP of the Asean countries plus their partners - China, India, Japan, South Korea, Australia and New Zealand - as more free trade was better for the region.

"In the AEC, Thailand is among those at the forefront with a head start due to its large consumer market, big auto industry, et cetera, hence many Thai firms can take advantage [of the opportunities]," he said, adding the country's political challenge has, however, hindered the economy in the past one or two years.

In addition to Thailand, he said, other Asean countries such as the Philippines and Indonesia were moving towards joining the TPP trade bloc over the next two years.

In the case of Thailand, there are clear benefits in joining the TPP in addition to the RCEP, he added.

At present, Singapore, Vietnam, and Malaysia are already members of both the RCEP and the TPP.

For this year, Incalcaterra said Thailand's economic growth rate would likely remain the lowest among Asean countries, with HSBC projecting 3.3-per-cent expansion.

China's slowdown will affect Thailand and Malaysia significantly, due to the two countries' large share of exports to China, where growth this year is projected to be less at 6.7 per cent, against 7.1 per cent in 2015, he said.

On the US Federal Reserve's interest-rate hike - the first in nine years - the economist said the move would create short-term volatility, but the gradual cycle of rate adjustments would not lead to a major disruption.

Meanwhile, Hai Pham, HSBC's chief executive officer in Vietnam, said there was plenty of room for intra-trade growth among Asean economies, which currently represented only 20 per cent of their total trade, compared to more than 60 per cent among members of the European Union.

He said cross-border investment was another high-growth area for Asean companies, citing Thailand's Berli Jucker and other firms as examples of Asean firms investing in Vietnam's retail and electronic-goods sectors.

For Vietnam, GDP growth is projected to be around 6-7 per cent this year, but the challenge is for local businesses to step up their efforts to meet the challenges presented by the AEC, as many are still not ready to take on increased competition.

The CEO also expects more consolidation of companies in Vietnam in 2016, due to the coming into effect of the AEC.

Source: http://www.nationmultimedia.com/business/TPP-and-RCEP-will-be-good-for-Thailand-30276046.html


-- The Nation 2016-01-04

[cloudhopper]

translation - You will all be assimilated and resistance is futile.

[sharecropper]

Thailand is too politically immature to join the TPP as there are other aspects to the Agreement that would impact on the repressive legal and Internet regimes here. I'm sure the Chinese one doesn't contain such troublesome matters though....

[Srikcir]

The two pacts are in conflict in terms of Thailand's relationship with China. Thailand is China's "backdoor" to ASEAN and SE Asia in general where China has considerable economic pressure. China does not need Thailand to develop an economic strategy that gives Thailand more independence from Chinese political objectives.

Thus far, Prayut has been lukewarm to TPP even while economists recommend joining. Prayut's foreign policy has been consistent with China's sense of regional supremacy, albeit one that has not really benefited the Junta beyond its relationship with China. Prayut sees the world in black and white terms; there is no "middle road." You are either for me or against me. It will take a regime change before Thailand joins TPP.

[wabothai]

Says a junior economist working for one of the largest banks in the world whose interest it is to push for TPP.

[brain150]

TPP is exclusively made for big corporations ... and bad for ALL members [including the US] !!!

[Thaidream]

TPP would be a disaster for the Thai people. It's sole purpose is to protect American business interests in The World thus raising prices on much needed items in Thailand beyond the ability of the majority of the Thai people to pay. It will destroy Thailand's Pharmaceutical industry and force huge price increases on essential drugs. The TPP needs to be rejected and renegotiated.

[elgordo38]

translation - You will all be assimilated and resistance is futile.

All that is left to be settled is that how the ordinary Joe in the trenches with a stagnant income and loaded with personal debt can go out buy all these wonderful new products available at his fingertips at so called lower tariff prices. Methinks his nose will be glued to the candy store window for a long time to come. Reminds of the old saying "We threw a party and new one came"

[elgordo38]

Says a junior economist working for one of the largest banks in the world whose interest it is to push for TPP.

Yes your right there is always that "hidden" agenda that we the unwashed masses were not meant to see. Everything is coated in "feel good" for us but in the end it never turns out that way. Look at NAFTA only one big winner Mexico. Why? the one signatory with lowest wages paid by far. Ergo Canada one of the best countries in the world to live in balanced budget debt of 35% of GDP has a .71 cent dollar vs it southern counterpart head over heels in debt and climbing north of 200 trillion and counting in total. Yes Canada is a petro currency country but then the US is no slouch in producing low priced oil either even exceeding Saudi Arabia production at times. Something is out of wack here. But this could all change this year. The problem with being a world leader is that there is always someone out to dethrone you. Chinks in the armor might be exploited this year. Remember what Isaac Newton said.

[elgordo38]

TPP would be a disaster for the Thai people. It's sole purpose is to protect American business interests in The World thus raising prices on much needed items in Thailand beyond the ability of the majority of the Thai people to pay. It will destroy Thailand's Pharmaceutical industry and force huge price increases on essential drugs. The TPP needs to be rejected and renegotiated.

To late it is signed sealed and delivered. The country by country vote is a forgone conclusion. Yes the politicians you voted for for change sure did a number on you the masses who toil and churn for big business. You are sitting at a table where big business eats the turkey and you get some crumbs that fall to the floor. They must give you a little something so that you continue to vote for them and in turn big business. Politicians make sure your choice is very narrow party A or party B. Add them both together and you get a F for failure for the populous. If my great grandchildren do not turn out to be the next Bill Gates I am afraid they are doomed. The marginalization of world workers will continue and robotics will ad the crowning touch. How China handles its workers is a window unto the future for all.

[Krataiboy]

What a crock of kee from this baby-faced hit-man from the banking mafia.

No explanation in his blatant soft sell of what the “clear benefits” will be if Thailand is gullible enough to join the secretly-drafted and negotiated TPP. Could this possibly be because there are none?

The TPP is no more a genuine “free trade” deal than was the ill-starred NAFTA rip-off.. What we have is another Trojan horse agreement designed to open up vulnerable developing markets across Asia to rapacious, mostly-US-based multinationals. Hence Obama's undignified antics in forcing it through Congress.

It cynically puts the interests of big corporations above those of governments and consumers, who will end up having to shell out for expensive brand-name pharmaceuticals and a wide variety of other goods instead of the cheap generic and home-made equivalents available now.

The Agreement erodes national sovereignty - to the extent that any member government rash enough to try and regulate the activities of foreign firms in the domestic market risks being hauled before an international kangaroo court and fined millions of dollars in "notional" lost profits.

Apart from the numerous practical objections to this egregious deal, would any government of integrity take advice on anything - even buying a second-hand tuk-tuk - from a bank with a record of laundering blood money for Mexican drugs cartels and international terrorist groups?

[connda]

TPP is great for any country that wants to become a vassal state of the US. Much better to plan for the long-term and create trade agreements between the countries in Southeast, South, and Central Asia. The future is building local economies and domestic trade. With TPP, the globalist will simply suck Thailand dry and spit out what remains.

[wabothai]

TPP is the biggest danger facing the East. Slavery will be reinvented and then on a scale not seen before.

[JohnDodd]

What a crock of kee from this baby-faced hit-man from the banking mafia.

No explanation in his blatant soft sell of what the “clear benefits” will be if Thailand is gullible enough to join the secretly-drafted and negotiated TPP. Could this possibly be because there are none?

The TPP is no more a genuine “free trade” deal than was the ill-starred NAFTA rip-off.. What we have is another Trojan horse agreement designed to open up vulnerable developing markets across Asia to rapacious, mostly-US-based multinationals. Hence Obama's undignified antics in forcing it through Congress.

It cynically puts the interests of big corporations above those of governments and consumers, who will end up having to shell out for expensive brand-name pharmaceuticals and a wide variety of other goods instead of the cheap generic and home-made equivalents available now.

The Agreement erodes national sovereignty - to the extent that any member government rash enough to try and regulate the activities of foreign firms in the domestic market risks being hauled before an international kangaroo court and fined millions of dollars in "notional" lost profits.

Apart from the numerous practical objections to this egregious deal, would any government of integrity take advice on anything - even buying a second-hand tuk-tuk - from a bank with a record of laundering blood money for Mexican drugs cartels and international terrorist groups?

Great analysis, would cause real hardship for many rural Thais that are dependent on those cheap generic medications. And the poster that said that this treaty is a done deal, is wrong, Prayut, or one of his adviser's have delayed the decision for now.

[DeaconJohn]

TPP would be a disaster for the Thai people. It's sole purpose is to protect American business interests in The World thus raising prices on much needed items in Thailand beyond the ability of the majority of the Thai people to pay. It will destroy Thailand's Pharmaceutical industry and force huge price increases on essential drugs. The TPP needs to be rejected and renegotiated.

Just reject it - don't bother to renegotiate.