FTA With Thailand May Bring No Benefits

Experts suggest government to think twice before engaging into and free trade agreement (FTA) with Thailand. Free trade agreement is a cooperation agreement between two countries to reduce trade barrier, import quotas and tariffs. Pakistan is currently engaged in FTA with china, Malaysia and Indonesia. Previously, FTAs brings less favorable terms for Pakistan export. Many high potential export items bring no concision under FTAs.

According to research by Pakistan business council (PBC), Pakistan’s top 50 high potential export items symbolize total 2.8 billion for Thailand market and the study also reveals the potential was not utilize by Pakistani exporters because 38% of potential items are already tax exempted by Thailand. Therefore FTA will bring not many benefits for Pakistan.

The study revels Thailand’s high potential items are consumer goods not capital goods, it makes the potential trade deficit and may impact the domestic consumer industry more severely.

Experts believe FTA is not a bad idea if Pakistani planners negotiate carefully. Historically, the planners have fails to ask for good concession or did not take the matter seriously. They fail to secure concession on high potential items with china, Malaysia and Indonesia, where other countries ether got zero or low duty.


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