China and Asean updating free trade deal
Negotiations about the so-called 3.0 version of the free trade zone started in November 2022 and were completed in May, seeking to cover areas such as the digital economy, green economy and supply chain connectivity.
China and Asean also agreed on a five-year action plan that specifies collaboration between the two sides in over 40 fields in the coming years, according to a statement published by the Ministry of Foreign Affairs, citing Wang's comments after attending the East Asia Summit in Kuala Lumpur on Friday.
Wang also said the two sides agreed to strive to complete consultations next year on a code of conduct in the South China Sea — a set of guidelines aiming to manage disputes in the region, where Beijing and several Asean members have overlapping maritime claims.
Work on the code of conduct has proceeded in fits and starts for more than two decades, during which Beijing has effectively taken control of several atolls and islets and built military installations on some of them.
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Bangkok Post
2 hours ago
- Bangkok Post
Thaksin's role in tariff talks raises questions
'I have to do something for the country. Regarding the economic situation today, if I do not poke my nose in, then who will?" so said former prime minister Thaksin Shinawatra on Thursday during a forum held at the National Office. Then, the following day, Thaksin was seen entering the Ban Phitsanuloke guest house to attend a meeting of "Team Thailand" for talks about Thailand's latest tariff proposal to the United States after the first round of tariff talks in Washington DC, which was a complete failure as the US did not cut the 36% reciprocal tariff rate originally imposed on Thai products imported to US market. Even Cambodia had the rare chance of taunting Thailand, claiming it managed to outsmart Thailand by convincing the US to cut the tariff rate for Cambodian products from 49% to 36%, which is on par with the rate imposed on Thailand by the US. Finance Minister Pichai Chunhavajira, who headed Team Thailand in the first round of the tariff talks, admitted he invited Thaksin to the meeting at Ban Phitsanuloke because the former prime minister was well-versed in the issue at stake and he might provide some valuable advice to the team. He is now under fire for a supposed ethics breach in extending the invitation. Several other Pheu Thai heavyweights have hailed Thaksin for his economic acumen and expertise, although the former prime minister was not a trained economist, but has a degree in criminology. They all believe Thaksin is the only person who can save Thailand from the punishing 36% tariff rate, which will wipe out Thailand's trade competitiveness in the US market compared to the other Asean nations. Except for Laos and Myanmar, which are not major exporters to the US and are facing a 40% tariff rate each, other Asean countries are facing lower rates than Thailand: 20% for Vietnam, although it is not formalised yet; 25% for Malaysia, 20% for the Philippines, 10% for Singapore, and 32% for Indonesia. Some critics have asked in what capacity was he at the meeting? Thaksin is not a member of the Pheu Thai Party because of his conviction on corruption charges. For a man of strong character like Thaksin, one could guess that he would have sat at the head of the table, dictating the Team Thailand meeting similar to the way he has been pulling the strings behind the party and the cabinet. It is such an open secret that even Thaksin himself does not bother to keep it under the rug, despite the party being at risk of dissolution for allowing an outsider to wield influence or control over the party. Another failure by Team Thailand will be disastrous for the economy. The Joint Standing Committee on Commerce, Industry and Banking has estimated that revenue loss for Thai exports to the US market would be about 900 billion baht per annum if Thailand was hit with a 36% tariff. Thai imports will be replaced by imports from Vietnam or Mexico. That means many small- and medium-sized enterprises may be closed and big manufacturers may cut production, resulting in mass layoffs. Foreign direct investments will shrink drastically because Thailand will not be attractive any more, and manufacturers may consider relocating elsewhere, such as Vietnam. Finding new markets for Thai products is easier said than done and near impossible. India is touted as a potential market because of its huge population, but its purchasing power cannot be compared with that of American consumers. If Thaksin is so smart and well-versed in trade and tariff issues, why didn't he volunteer to offer his valuable advice to Team Thailand from the beginning? Thaksin's faithful supporters have bragged about his close connections with those around President Donald Trump, but why didn't he make use of his connections in the first place? Will his involvement in the preparation of the revised tariff proposal work its magic this time? Since Thaksin has decided to poke his nose in this crucial matter at his own initiative, should he be held accountable if the team fails this time? But to be honest, most Thais, even those who despise Thaksin for his alleged abuses, special privileges and wrongdoing, do not want Team Thailand to fail because the high cost of failure is too much to bear. Be realistic -- we do not expect a fair deal from the Trump administration, which has made clear that Thailand has enjoyed a substantial trade surplus with the US for a long time. Regardless, we expect the US to treat us as a trusted ally, and the tariff rate should be adjusted to the point where Thai products can remain competitive in the US market. That should be fine enough.
Bangkok Post
15 hours ago
- Bangkok Post
Thai defence chief suggests ways to ease border tensions with Cambodia
Chief of Defence Forces Gen Songwit Noonpakdee has urged Cambodia to coordinate border operation hours and withdraw long-range weapons to facilitate cross border trade and ease tensions between the two countries. He has called for a reduction in military presence along the Thai-Cambodian border and proposed the withdrawal of long-range weaponry to levels consistent with those in 2024. He reiterated that Thailand has never closed its border checkpoints, but merely r egulated their operating hours. He further suggested that both countries should synchronise their checkpoint opening times to facilitate cross-border trade and ease the movement of people. Genl Songwit said that last Friday, Lt Gen Boonsin Padklang, commander of the 2nd Army Region, informed him that military-level dialogue and cooperation had significantly increased. This includes joint border patrols being conducted three times a week, a development that Thailand supports. He said Thailand's position remains steadfast on the following principles: preservation of national sovereignty, which has been consistently upheld in accordance with Thailand's operational maps, and continued bilateral dialogue through established mechanisms including the Regional Border Committee (RBC), the Joint Boundary Commission (JBC), and the General Border Committee (GBC). The desired outcome of these discussions, General Songwit said, is to de-escalate military confrontations along the border. In particular, he called for a return to pre-existing force levels and the removal of long-range weapons, emphasising that military presence should be proportionate and limited to ensure the safety of civilians in both countries. He also expressed a desire to see greater facilitation of cross-border trade and movement, confirming that Thailand has not closed any checkpoints. He clarified that Thailand currently operates its border crossings from 8am to 4pm, whereas Cambodia has opted to close many of its border points. As such, he proposed that both nations agree to standardised checkpoint operating hours—from 8am to 6pm—to allow smoother traffic and mobility across the border. Scam networks Gen Songwit also addressed the issue of transnational scam networks, saying that a recent tripartite meeting was held in Myanmar, involving representatives from Thailand, China, and Myanmar. The meeting concluded with a consensus to continue operations to dismantle call centre scam syndicates, as significant numbers of individuals remain involved in these criminal enterprises. To date, over 8,000 individuals have been repatriated, yet estimates suggest the original target number may be as high as 50,000. In the area opposite Mae Sot District in Myawaddy, Myanmar, Chinese authorities estimate that approximately 50,000 people are to be processed and returned. Several business operators in Myanmar connected to these scam networks have already been forced to cease operations under local legal orders. Some of these operators also face international arrest warrants. As Myanmar continues to face increased pressure through disruptions to electricity, internet, and fuel supplies, scam operations have started relocating, particularly towards the eastern regions. Thailand's Task Force 88 has consequently intensified its operations in those areas. Arrest warrants have already been issued, and cooperation has been sought from both domestic and international authorities, including neighbouring countries. Thailand plans to establish a multinational special task force this month to directly address the issue of scam syndicates. Task Force 88 will be responsible for providing further operational details.
Bangkok Post
a day ago
- Bangkok Post
China must 'play long game' with trade partners as 'US looks like the big bully': analysts
With US President Donald Trump sending more tariff letters to trade partners, Beijing has stepped up efforts - like rallying its own trade partners - to collectively push back against Washington's trade protectionism. The world's second-largest economy will provide considerable development opportunities - from broader market access to greater regional integration - while being mindful of US threats, according to statements this week following a string of overseas visits by Chinese officials. Some analysts say the comments suggest that Beijing is embracing an increasingly pragmatic approach, rather than just strongly worded warnings, as it fortifies itself for another round of talks with Washington early next month. "China needs to project a firm diplomatic stance to declare its principles, while this should be coupled with actions that offer tangible benefits to its neighbouring trade partners," said Chen Fengying, a senior fellow at the China Institutes of Contemporary International Relations. "The US will inevitably impose additional tariffs on transshipped goods," Chen said. "So, it is crucial for China to play the long game with its neighbours and gradually build a more unified regional market." While meeting his counterparts on Thursday at the China-Asean Foreign Ministers' Meeting in Kuala Lumpur, Malaysia, Chinese Foreign Minister Wang Yi vowed to upgrade the existing free-trade agreement with the 10-nation bloc. Most members received a 20-40% hit from Trump's so-called reciprocal tariffs. Wang also offered an olive branch to South Korea and Japan, vowing to move towards a trilateral free-trade deal, and to promote the Regional Comprehensive Economic Partnership, a trade deal comprising major Asian economies and Australia. "The more complex the situation becomes, the more we must shield our cooperation from disruptions," he said. A day earlier, commerce vice-minister Ling Ji arrived in Cambodia, where he expressed to officials China's willingness to "jointly address the risks and challenges posed by protectionism and unilateralism". Cambodia, a country with rising Chinese investment, was hit with a 36% US tariff. Transshipments by Chinese exporters are a key target of the US tariffs. Louise Loo, head of Asia economics at Oxford Economics, said that while the definition of a "transshipment" remains unclear, the tiered-tariff system in the Vietnam-US deal is set to weaken the advantage of "China plus one" manufacturing. "Economies like Vietnam and Cambodia, which are highly reliant on Chinese inputs, are particularly vulnerable," Loo said. Nick Marro, principal economist for Asia at the Economist Intelligence Unit, said: "It's obvious that the transshipment tariffs are targeting China - Beijing knows this. So, they are going to be very sensitive to any move by the Vietnamese or any other economy to crack down on Chinese shipments. "At the end of the day, Beijing doesn't want to alienate other countries at a time when the US looks like the big bully in the room." Asian governments, caught between China and the US, may seek lower tariff rates before Trump's Aug 1 deadline. However, Washington's one-after-another tariff decisions set a high threshold for tariff relief, according to analysts, and some say it could be advantageous for Beijing to encourage other countries to take a harder stance. "Tariffs would presumably be removed if recipient economies decide to build or manufacture products within the United States," Loo said. "We think this represents a very high bar for a complete tariff de-escalation." Loo pointed to South Korea's experience, noting that, despite relocating part of Hyundai's production to the US and increasing reshoring efforts, the country still faced a 25 per cent tariff. And Vietnam, despite being receptive to a deal since Trump announced his "Liberation Day" tariffs on April 2, still saw its US-bound goods hit with a 20% tariff. South Korea and Japan - US allies slapped with 25% US tariffs - are seeking to take a harder stance in negotiations. Canada, a free-trade neighbour of the United States under the United States-Mexico-Canada Agreement, was hit with a 35% duty. Brazil, a key member of the Brics bloc of emerging economies, including China, has threatened to retaliate against the 50% tariff that Washington slapped on Brazilian exports to the US. "The tariffs on Brazil, in response to the treatment of former president Jair Bolsonaro, showcase how tariffs are being used as a tool for a number of aims of the administration," two of HSBC's global economists, James Pomeroy and Maitreyi Das, wrote in a note on Friday.
