Political and economic relations

Overview

The EC-ASEAN Agreement of 1980 constitutes the legal framework for relations with Thailand. At the bilateral level, the dialogue takes place through regular, informal EC-Thailand Senior Officials’ Meetings (SOM) led by the Commission on the EC side. The first SOM was held in Bangkok on 6 March 1992 and the latest (the 10th) on 21 May 2010 in Brussels. As the EC-ASEAN agreement of 1980 is outdated and no longer sufficient as a basis for our relations, the 2003 Commission Strategy for Southeast Asia offers bilateral agreements to interested countries in the region. Such bilateral agreements would promote a relationship based upon a modern policy agenda with an appropriate institutional framework and enabling a policy dialogue on a wide range of policy issues.

On that basis, the Council granted in November 2004 negotiating directives for bilateral Partnership and Co-operation agreements with certain Southeast Asian countries which do not yet have any bilateral agreement with the EC. Among these countries is Thailand. An announcement of the intention to launch negotiations with Thailand was made in Hanoi in October 2004, at the margins of the ASEM Summit, by the then President Prodi and former Prime Minister Thaksin. The launch underlined our wish to reinforce our bilateral ties and our commitment to reinvigorate relations with Thailand. The parties have yet to finalise the negotiations which are on-going.

Trade between the EU and Thailand is considerable, amounting to approximately €27 billion (1.15 trillion Baht) in 2010. The EU is Thailand's second largest export market, after the ASEAN. In 2010, exports from Thailand to the EU totalled some €17 billion (approx. 725 billion Baht).

The strength of Thai exports has led to substantial trade surpluses with the EU. During the period 2007-2009 Thailand’s annual trade surplus with the EU stood on average at around €5.5 billion per annum (approx. 220 billion Baht).

Notably, more than half of Thai exports entering the EU receive preferential treatment either via Most Favoured Nation (MFN) or partial or full tariff elimination granted under the EU’s Generalized Scheme of Preferences (GSP). Thailand is also the second largest GSP beneficiary among EU's trade partners behind India.