Jan 2, 2008

Thailand: Pro-Thaksin PPP Says It Can Form Government

It looks like Thai politics will remain unstable for some time. The pro-Thaksin People Power Party believe that they have the support now to form a new Government, but as this AFP story suggests, the numbers game is a bit of a moving feast. The PPP has secured the support of three smaller parties, but 3 of the PPP's winning candidates look set for disqualification due to vote buying (some things don't change much in Thai politics!!). Even if the PPP do form the Government, Thailand is likely to remain a deeply divided country, divisions are likely to deepen further if former PM Thaksin returns home in April, as his threatening to do.

The Hive's particular concern is what this instability, and Thaksin influence, will mean for the important services negotiations which are due between New Zealand and Thailand in 2008.

We repeat below the relevant provisions of the Closer Economic Partnership (Labourspeak for FTA) which came into force on 1 July 2005.

Liberalisation of Trade in Services

1. The Parties agree to conclude an agreement which liberalises trade in services between the Parties and which is consistent with Articles V.1 and V.3 of GATS.

2. For the purposes of Paragraph 1, the Parties shall enter into negotiations on trade in services within three years from the date of entry into force of this Agreement, with the aim of concluding an agreement to liberalise trade in services between the two Parties as soon as possible.
According to our maths this means that negotiations must be started before 1 July 2008.
The Hive understands that preliminary talks about how to go about this negotiation had been planned late last year, but were shelved at the request of the Thai Government because of the forthcoming election. The Hive also understands that business groups remain angry that services were excluded from the original agreement and that there will be serious repercussions for the Government if it fails to deliver on the Agreement to have services incorporated into the agreement in 2008. Services make up close to 70% of New Zealand's GDP and close to 30% of New Zealand's exports.