international trading problem between thailand and usa by big poop-pup double extra

7/29/2019 International Trading problem between Thailand and USA By Big Poop-Pup Double Extra

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INTERNATIONAL TRADING PROBLEM BETWEEN

THAILAND AND USA

by

1. ID 5331203008 Miss Kunlayada Reankeaw

2. ID 5331203009 Miss Kittiporn Worametrachanon

3. ID 5331203013 Miss Jaruwan Kanchai

4. ID 5331203031 Miss Natthaporn Juntima5. ID 5331203041 Miss Thanaphorn Durongkachayanuruk

6. ID 5331203058 Miss Panita Chaiparinya

7. ID 5331203060 Miss Porrawisa Pattana

8. ID 5331203061 Miss Prareena Raksa

9. ID 5331203062 Miss Pawanrat Laonapaporn

10. ID 5331203085 Mr. Panupon Rattanarangsan

11. ID 5331203120 Mr. Sasawat Gunpai

12. ID 5331203138 Mr. Adisuan Kanharattanachai

13. ID 5331203147 Miss Anchittha Nanan

14. ID 5331203148 Miss Areerat Chairin

A term paper submitted in partial fulfillment

of the course 1001204 Understanding Global Society

MAE FAH LUANG UNIVERSITY

Second semester, academic year of 2012

February, 2013


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PREFACE

This term paper is one part of Understanding Global Society course which relate with

Business Administration major in Mae Fah Luang University. The topic is InternationalTrading problem between Thailand and USA which is study about trade in the past to

present. It always changes in many part as rapidly such as education, economy, social, and

telecommunication. When we are study about the information at the part to the present,

we can predict economy in the future. The economy is important to developing country

because it shows the well-being of the population in the country and it can reflect to the

government policy. In this term paper is include with the beginning of free trade, free trade

agreement with USA, condition of agreement, problem, benefit, and affection of free trade.

All of this will reflect to the relationship between two countries. There are great power

country and developing country.

Our group selects this topic because we are interested in economy between great

power country and developing country. There have many interesting condition, advantage-

disadvantage to each country. And it relates with the lesson that we have study. Finally, our

group hopes that this term paper will give knowledge to the reader as much as we can. If

there is any mistake in this term paper, we would like to apologize for our mistake.

Thank you for your attention

From manipulator


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TABLE OF CONTENTS

PREFACE ................................................................................................................................ i

1. CHAPTER ONE INTRODUSTION ....................................................................................... 1

1.1 Statement of Problem .. .................................................................................... 1

1.2 Connect Activity ........................................................................................................ 2

1.3 Outline ....................................................................................................................... 2

1.4 Gantt Chart ................................................................................................................ 4

2. CHAPTER TWO INTERNATIONAL TRADING BETWEEN .................................................... 5THAILAND AND USA

2.1 History of Thailand and USA trading ......................................................................... 5

2.1.1 Thailands Trading ...................................................................................... 5

2.1.1.1Basic information of Thailand ......................................................... 52.1.1.2Thailand International trade ........................................................ 62.1.1.3U.S. Relations with Thailand ........................................................... 82.1.1.4 U.S. Assistance to Thailand ............................................................. 9

2.1.1.5Bilateral Economic Relations ........................................................ 10

2.1.1.6Thailands Membership in International Organization................. 102.1.1.7Bilateral Representation ............................................................... 10

2.1.2 USAs Trading ........................................................................................... 11

2.1.2.1 Basic information of USA .............................................................. 11

2.1.2.2 Economic ....................................................................................... 11

2.1.2.3 Important policy in term of International Trade .......................... 12

2.1.2.4 Policies that affect the Southeast Asia ......................................... 12

2.1.2.5 International Trade policy toward the region .............................. 13

2.1.2.6 Policy to ASEAN ............................................................................. 13

2.2 The policy of trading between Thailand and USA ................................................... 14

2.2.1Trade Policy of Thailand ............................................................................ 142.2.1.1The Protective Trade Policy ........................................................... 142.2.1.2 The Free Trade Policy ..................................................................... 14


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TABLE OF CONTENTS - CONTINUED

2. CHAPTER TWO INTERNATIONAL TRADING BETWEEN

THAILAND AND USA (CONTINUED)

2.2.2 Trade Policy of USA .................................................................................. 15

2.2.2.1USA Policy ..................................................................................... 152.2.2.1.1 Policy/measure of U.S. trade ............................................ 16

2.2.2.1.2 Trade Agreement .............................................................. 17

2.2.2.2Agreement under WTO................................................................. 182.3 The important situations that occur in the trading ................................................ 20

between Thailand and USA

2.4 The Politic of Thailand and USA .............................................................................. 21

2.4.1 Politic of Thailand ..................................................................................... 212.4.1.1 Policy on Foreign Affairs and International ......................... 21

Economic 2011 (Thailand)

2.4.2 Politic of USA ............................................................................................. 23

2.4.3 Relation between Thailand and USA ........................................................ 23

2.4.3.1 Ally Thailand USA: Past and Present ................................. 23

2.4.3.1.1 Economy................................................................. 23

2.4.3.2 Ally Thailand USA: The Future .......................................... 24

2.4.3.2.1 Enhance relationships ............................................ 24

2.4.3.2.2 Focus on mutual benefit ........................................ 25

2.4.3.2.3 Revive negotiations FTA of .................................... 25Thailand USA

2.4.3.2.4 Critic ....................................................................... 25

2.4.4 Critic (Strategic of Thailand to USA) ......................................................... 26

2.4.4.1 Impact on Thailand from TPP .............................................. 26

2.4.5 Conclusion: Politic of Thailand effect to USA ........................................... 26

2.5 FTA between Thailand and USA .............................................................................. 27

2.5.1 Free Trade barrier between Thailand and USA ........................................ 27

2.6 Non-tariff ................................................................................................................. 29

2.6.1 Type of barrier for trading between Thailand and USA ........................... 30

2.7 Market Share of Thais export goods ...................................................................... 312.7.1 Export of consume product in 2007 - 2011 .............................................. 31


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2.8 Why does Thailand do Free Trade Agreement: FTA? ............................................. 32

What are the benefits?

2.8.1 The countries where do Free Trade Agreement with .............................. 33

Thailand

2.8.1.1 Negotiation Free Trade Agreement of Thailand .................. 33

and other countries

2.8.2 Opportunities of Thailand USA Free Trade Agreement ......................... 33

2.9 Watching Back to Thailand-USA Economic for five years, both ............................. 36

of opportunity and barrier2.10 The effect of trading between Thailand and USA ................................................. 37

2.10.1 Exports between Thailand and USA ........................................................ 37

2.10.2 U.S.-Thailand Trade Facts ....................................................................... 37

2.10.2.1 Exports ............................................................................... 37

2.10.3 Thailand GDP Growth Rate ..................................................................... 40

2.10.4 USA GDP Growth Rate ............................................................................ 41

2.10.5 Market Opportunities ............................................................................. 42

2.10.6 Market Challenges .................................................................................. 42

2.11 The Negotiation that occur between Thailand and USA include.......................... 43

with benefit and impact2.11.1 The Negotiation between Thailand and USA .......................................... 43

2.11.2 The drawback of FTA between Thailand and USA .................................. 44

2.11.2.1 About trading products...................................................... 44

2.11.2.2 About investment .............................................................. 44

2.11.2.3The opportunity of doing FTA between ............................ 44Thailand and USA

2.11.3 Affection of trading between Thailand and USA .................................... 45

2.11.3.1 Affect to agriculture ........................................................... 45

2.11.3.2 Affect to automotive industry ........................................... 45

2.11.3.3 Affect to service of telecommunication ............................ 45and electronic ecommerce

2.11.3.3.1 Telecommunication ............................................. 45

2.11.3.3.2 Electronic ecommerce ......................................... 46

2.11.3.4 Affect to financial management ........................................ 46

2.11.3.5 The protection of intellectual property ............................. 46

2.11.3.6 Conclusion .......................................................................... 46


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2.12 The relationship between WTO and Thailand ....................................................... 47

2.12.1 Introduction ............................................................................................ 47

2.12.2 Agriculture .............................................................................................. 48

2.12.3 Trade-Related Intellectual Property Right .............................................. 48

2.12.4 Food Safety ............................................................................................. 49

2.12.5Investment and Competition .................................................................. 512.12.6 Textiles and Clothing ............................................................................... 51

2.12.7 Conclusion ............................................................................................... 52

2.13 Reflection of trading between Thailand and USA ................................................. 52

3. CHAPTER THREE CONCLUSION ..................................................................................... 53

REFERENCES ...................................................................................................................... 54


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LIST OF TABLES

Table Page

1. Table 2.1 Trade (expressed in billions of US$): Thailand .................................... 6

2. Table 2.2 Export of consume product in 2007 .................................................. 31





7. Table 2.7 The Trading between Thailand USA ............................................... 36


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LIST OF FIGURES

Figure Page

1. Figure 2.1 Location of Thailand ........................................................................... 5

2. Figure 2.2 Balance of trade ................................................................................. 7

3. Figure 2.3 U.S. Thailand Relations.................................................................... 8

4. Figure 2.4 U.S. Assistance Worldwide ................................................................ 9

5. Figure 2.5 USA Map........................................................................................... 11

6. Figure 2.6 4th ASEAN-U.S. LEADERS MEETING ................................................. 14

7. Figure 2.7 Textile ............................................................................................... 27

8. Figure 2.8 Black tiger prawn ............................................................................. 28

9. Figure 2.9 Canned Pineapple ............................................................................ 28

10. Figure 2.10 The process in Shrimps factory in Thailand ................................ 30

11. Figure 2.11 Free Trade Agreement of Thailand .............................................. 33

12. Figure 2.12 Textile goods ................................................................................ 34

13. Figure 2.13 Agriculture goods ......................................................................... 34

14. Figure 2.14 Auto parts .................................................................................... 35

15. Figure 2.15 Electrical Machinery..................................................................... 37

16. Figure 2.16 Precious Stones ............................................................................ 38

17. Figure 2.17 Machinery .................................................................................... 38

18. Figure 2.18 Cotton .......................................................................................... 38

19. Figure 2.19 Soybeans ...................................................................................... 39

20. Figure 2.20 Wheat ........................................................................................... 39


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LIST OF FIGURES - CONTINUED

Figure Page

21. Figure 2.21 Feeds and Fodders. ...................................................................... 39

22. Figure 2.22 Dairy Products. ............................................................................. 39

23. Figure 2.23 Thailand GDP Growth Rate .......................................................... 40

24. Figure 2.24 USA GDP Growth Rate ................................................................. 41

25. Figure 2.25 Meeting Free Trading ................................................................... 44

26. Figure 2.26 Agriculture in countryside of Thailand ........................................ 48

27. Figure 2.27 Anti-Retroviral AIDS Drug ............................................................ 49

28. Figure 2.28 Beautiful traditional textiles of Northern Thailand ..................... 51


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CHAPTER 1 - INTRODUCTION

1.1 Statement of Problem

The reason that we choose to study the content about the international trading

between Thailand and USA because nowadays trading is the one of the power that drives

economics in globalization. Also the competition of trading is very interesting to analyze.

The trading between Thailand and USA can also describe the relationship between the

countries; politic policy, international, law and technology as well.

There are the outstanding things in the studying about the trading between Thailand

and USA. About America, it is the great power country of trading and being the monopoly of

some products in some countries. Also the power of negotiation comes from the

competition advantage from trading. It is because the market in USA is also the big top

market among the world. So, this is the outstanding point that should be looking for; also,

the trading history, problem and opportunity for the both of countries.

The important thing of trading countries, Thailand and USA, is the long history since

World War 2. Thailand and USA had the military policy and the international trading as the

alliance countries. As also today that USA has more monopoly power in some importingproducts; such as, shrimp, parts of computers, electronic circuit and canned food. In some

cases, we can reflex the relationship that USA has toward the other countries by inferring

the relationship between Thailand and USA.

It is very important to understand and analyze the trading between Thailand and

USA because it can reflex the conducting, practicing, law and international policy of USA.

These can effect to the other countries in that time by understanding from doing analysis.

As to understanding the role, status, the international relationship because these factors

has the relationship to each other.

The interesting of the content that we will get from learning The international

trading problems between Thailand and USA by the reason, outstanding and the

interesting of the topic. Also the understanding in the international trading between

Thailand and USA can help us to gain the idea and knowledge from the analyzing. So, we will

understand the plausibility, dynamic of the economic and the power that was hidden by the

great power country that has to the trading countries like Thailand. As Thailand and USA can

be the case study and can use to apply as to understanding globalization society.


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1.2 Connect Activity

Our topic is connecting with the content of the lesson. There is The International

trading Problems between Thailand and USA. All of the problem, we should understanding

the problem and depth study as the understanding globalization such as how therelationship between the country, history, policy, trading, and the effect from the problem

when its occur. Moreover, we can summarize the topic as where the problem comes from,

what is the element of it, what is the factors that make the problem occur, how the

problem stay, and how to eliminate the problem. All of those including with the tangible

and intangible problem by the case study of earth, world, and globe by Same Same but

Different chapter. In addition, the Conflict and Cooperation chapter will give the

information of the relationship between Thailand and USA and study the world economic

from Economic Dynamism. Some factor will effect because the culture, then it relate with

the Considering Culture Diversity. Although the facilitate tools for communication, trading,

and the distribution the information by Technology and the Global Change, andGlobalization chapter. Sometime when the problem is occurring such as Tom-Yum-Kung

crisis, it will have the Domino Effect as no one expect before. Until the role of Thailand

trading with world stage by make the understanding with the problem of trading between

Thailand and USA.

1.3 Outline

The history of trading between Thailand and USA (for study about history andanalyze some situation that occur and effect to the relationship of trading until the

situations that make the problem occur, available , and gone).

History of Thailands trading History of USAs trading

The policy of trading between Thailand and USA (for study about all of the policy in

Thailand and USA, and the supporting of trading between the countries).

The trading between the countries law (for study about the step, procedure, and theprohibition of trading between the countries).

The statistic, information, trading, export between Thailand and USA (for study

about the increase and decrease information of the number of the export between Thailand

and USA).


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The important situations that make the problem occur with the trading between

Thailand and USA (for study about the important situation that effect to the problem with

the trading between the countries for the past to present.

Review and analysis of the important situation Review and analysis of the trading situation between Thailand and USA

The reflection of trading between Thailand and USA toward the international trading in

global society (To study the international trading between Thailand and USA which lead to

the affection in the global society)

The conclusion of the problem between Thailand and USA, and the future of international

trading between Thailand and USA.


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1.4 Gantt Chart


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Figure 2.1: Location of Thailand

CHAPTER 2 - INTERNATIONAL TRADING BETWEEN THAILAND AND USA

2.1 History of Thailand and USA trading

2.1.1 Thailands trading

2.1.1.1 Basic information of Thailand

Location: Thailand is the country that located in South

East Asia. Its neighborhood;

North Myan Mar and Lao

East Lao and Cambodia

South The gulf of Thailand and

Malaysia

West Andaman Sea and

Myan Mar

Capital City: Thailand

Official language: Thai and others

(English, Chinese, Japanese, etc.)

Government: Democracy under the Constitution of

The kingdom of Thailand

Area: Total area 514,000 kilometers or 198,457 milesand 0.4% of water.

Population: 65.98 million (2007)

Currency: Baht (, THB)

Geographic: Thailand has varies of geographic. At the North part of Thailand, there

are a lot of mountains. The highest point is at Doi Inthanon (2,576 meters), Chiang Mai. At

the North-East part, it is the highland which connected with Mekong. In the central part, it is

the low land connected with Chao Phraya which flow to the gulf of Thailand. At the south

part, the area becomes more narrower and then become big again at Malay Peninsula.

Reference:

http://www.lonelyplanet.com/maps

/asia/thailand/map_of_thailand.jpeg


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Weather: The weather of Thailand will be like the tropical area. The hottest weather

is in April-May. The rainy season is in May-October. In November to March, it is dry and has

the cool wind. However, this all except the South part of Thailand which has the tropical wet

all year.

Ethnicity: Thailand has varies of ethnicity, Thai, Thai-Lao, Thai-Mon, Thai-Cambodia,Thai-Chinese, Thai-Malayu, etc. Also, it includes the tribe as well, such as; Karen, Mong and

others. These all are important to the way of life and Thailand culture. So, nowadays the

population who is Thailand is about 75% , Thai-Chinese about 14% and others 11%.

Religion: About 95% of Thai population is Buddhism, Theravada, Islam about 4%

(Thai people who live in South part of Thailand), Christian and others about 1%.

2.1.1.2 Thailand - International trade

Thailand has a long history of international trade. Beginning in the 15th to 18thcenturies, during the reign of the Ayutthaya monarchy, foreign merchants who lived near

the kingdom's capital conducted trade with foreigners. The country's first significant trade

treaty was the Bowring Treaty in 1855 with Britain. Shortly after that, it also signed treaties

with 14 other countries including USA, France, Russia, Sweden, Spain, and Japan.

Table 2.1: Trade (expressed in billions of US$): Thailand

Year Exports Imports

1975 2.208 3.280

1980 6.505 9.214

1985 7.121 9.242

1990 23.070 33.379

1995 56.439 70.776

1998 54.456 42.971

Sources:International Monetary Fund. International Financial Statistics Yearbook 1999.

Today, USA, Japan, and the European Union continue to be its top trading partners,

absorbing 52.6 percent of all exports in 1999 and supplying 48.8 percent of total imports in

the same period. Its other partners are Hong Kong, China, and the Association of South-East

Asian Nations (ASEAN) countries, the most significant of which are Singapore and Malaysia.

Other countries apart from those mentioned accounted for 18.4 percent of exports and 21.6

percent of imports in the same period.


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Thailand's major exports are rice, tapioca products, cane sugar and molasses, and

rubber for agriculture; chemicals, polymers, and plastics for the manufacturing industry; and

gypsum, natural gas, and feldspar for the mining industry. Bank of Thailand statistics as

reflected in the Asian Economic Survey of 2000 identified the country's major export

products as machine parts, circuits, frozen shrimp, prawns, sundry items, computer parts,

garments, vehicle parts, and plastic products. On the other hand, its major imports arepetroleum, integrated circuit parts, and chemicals.

The balance of tradewas consistently

negative until 1998, which means that the value of

the country's imports was bigger than the value of

its exports. The discrepancy was minimal in 1970,

with import value exceeding export value by only

US$541 million. In 1975, imports exceeded exportsby US$1.072 billion, which doubled in 1980 to

US$2.709 billion. In 1985, imports still exceeded

exports by US$2.21 billion, which had quadrupled

by 1990 to US$10.309 billion. In 1995, the balance

still stood in favor of imports by US$14.337 billion.

In a considerable reversal, imports in 1997 exceeded

exports by US$5.319 billion but the following year,

exports exceeded imports by US$11.485 billion.

Despite the uneven balance of trade, the Thai economy continued to grow by anaverage of 6.8 percent in the 1970s, 7.5 percent in the 1980s, and 8 percent in the early

1990s before the Asian financial crisis. This growth can be attributed to 2 factors, namely

the boom of the tourism industry and the inflow of foreign direct investment. According

to International Historical Statistics, in 1970, the services sector contributed 44.1 percent of

GDP, which increased in 1980 to 49.7 percent. Though this contribution fell to 46.9 percent

in 1999, it is safe to say that the dollar earnings from the tourism industry generated a

substantial amount, enough to offset the trade imbalance.

Foreign direct investment (FDI) is another major factor in the growth of the economy

since the mid-1980s. In 1988, FDI infused US$1.25 billion into the economy, partlyexplaining the 7.5 percent growth despite a US$4.332 billion discrepancy in balance of trade

in favor of imports. Foreign direct investment doubled to US$2.5 billion in 1990.

Thailand is a member of several international trade organizations including the

ASEAN Free Trade Area (AFTA), the Asia Pacific Economic Cooperation (APEC), and the

World Trade Organization (WTO).

Figure 2.2: Balance of trade

Reference:http://seekingalpha.com/article/241818-trade-balance-the-u-s-is-a-net-exporter-of-solar-products/ saupload_trade_balance.jpeg


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2.1.1.3 U.S. Relations with Thailand

Bureau of East Asian and Pacific Affairs

Fact Sheet 31 July, 2012

U.S.-Thailand Relations

USA and Thailand established diplomatic relations in 1882 and signed a Treaty of

Amity and Commerce in 1833. Thailand is a constitutional monarchy headed by a civilian

government. Over the decades, Thai democracy has been interrupted by military coups and

rule, and civic and political unrest. Thailand is a key U.S. security ally in Asia, and the

country's stability and growth are important to the maintenance of peace in the region.

Since World War II, USA and Thailand have significantly expanded diplomatic and

commercial relations.

USA and Thailand are among the signatories of the 1954 Manila Pact of the former

Southeast Asia Treaty Organization (SEATO). Despite the dissolution of the SEATO in 1977,the Manila Pact remains in force and, together with the Thanat-Rusk communiqu of 1962,

constitutes the basis of U.S. security commitments to Thailand. In 2003, USA designated

Thailand a Major Non-NATO Ally.

Figure 2.3: U.S. Thailand Relations

Reference: http://www.thailand-business-law-center.com/wp-

content/uploads/2012/10/registering-a-tha-us-amity-

treaty-company1.jpeg


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2.1.1.4 U.S. Assistance to Thailand

U.S. foreign assistance, in partnership with the Royal Thai Government, focuses on

strengthening Thailands democratic institutions and our security cooperation both

bilaterally and in the region. U.S. assistance aims to strengthen Thai efforts to reform the

criminal justice system, promote good governance through democracy and rule of lawactivities, and invest in people through humanitarian assistance for displaced persons and

control of the HIV/AIDS epidemic and other infectious diseases. USA also supports

Thailands ongoing active contributions to regional and global security.

Thailand and USA have longstanding cooperation in international law enforcement

efforts. USA and Thailand work closely together and with the United Nations on a broad

range of programs to halt illicit drug trafficking and other criminal activity, such as trafficking

in persons. Thailand has received U.S. military equipment, essential supplies, training, and

assistance in the construction and improvement of facilities and installations for much of

the period since 1950. As part of their mutual defense cooperation, Thailand and USA havedeveloped a vigorous joint military exercise program, which engages all the services of each

nation and averages 40 joint exercises per year.

The U.S. Agency for International Development (USAID), through the Regional

Development Mission for Asia in Bangkok, supports regional, transnational, and bilateral

programs. These programs include work on the responsible use of natural resources;

reduction of the incidence of HIV/AIDS and other infectious diseases; prevention of human

and wildlife trafficking; resolution of political conflict and increased citizen participation in

political processes; and the achievement of an integrated Association of Southeast Asian

Nations (ASEAN) community by 2015. USAID and the Thailand International DevelopmentCooperation Agency ("TICA") are engaged in discussions on possible partnership to address

development needs in third countries in the region. U.S. Peace Corps volunteers focus on

primary education, with an integrated program involving teacher training, health education,

and environmental education. In 2003, the Peace Corps also established an organizational

development program aimed at promoting sustainable rural development in Thai

communities.

Figure 2.4: U.S. Assistance Worldwide

Reference: www.flickr.com/7187466629_80871fb480_z.jpeg


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2.1.1.5 Bilateral Economic Relations

USA is Thailands third-largest bilateral trading partner, after Japan and China, with

total trade valued at more than $35 billion in 2011. USA is also one of the largest investors

in Thailand, bringing in more than $466 million in net foreign direct investment in 2011.

Leading Thai imports from the U.S. include machinery, chemicals, gold, optic and medicalgoods, aircraft, and agricultural products. Thai exports to USA include machinery, rubber,

prepared meat, shrimp and tuna, jewelry, and other agricultural products.

The 1966 Treaty of Amity and Economic Relations, the most recent iteration of the

1833 Treaty of Amity and Commerce, facilitates U.S. and Thai companies' economic access

to one another's markets. The two countries also have agreements addressing sales of

agricultural commodities and investment guarantees.

The Thai-U.S. Creative Partnership builds on existing public-private and

intergovernmental relationships, seeking to emphasize innovative industry, identify newopportunities for collaborative ingenuity between the two countries, and spur increased

productivity.

2.1.1.6 Thailand's Membership in International Organizations

Thailand is a founding member of ASEAN and strongly supports its efforts to

promote economic development, social integration, and stability throughout the region.

Thailand and USA belong to a number of the same international organizations, including the

United Nations, ASEAN Regional Forum, Asia-Pacific Economic Cooperation forum,

International Monetary Fund, World Bank, and World Trade Organization. Thailand also is aPartner for Cooperation with the Organization for Security and Cooperation in Europe and

an Organization of American States observer.

2.1.1.7 Bilateral Representation

The U.S. Ambassador to Thailand is Kristie A. Kenney; other principal embassy

officials are listed in the Department'sKey Officers List.

Thailand maintains an embassy in USA at 1024 Wisconsin Ave. NW, Washington DC

20007 (Tel. 202-944-3600).

Conclusion of history of trading between Thailand and USA

In the last hundred years ago, Thailand and USA has good relationship together even

some period both countries has the obstruction as military part or the barrier from USA.

USA wants to create more power to make the balance. At the developed country, it is the

way to show their power by international trade, and export the product with Thailand. It will

reflect that international trading between great power country and small power country can

trade together but it will have the barrier. The barrier always makes Thailand loss the

benefit in every trading. Then the small country group together for resist the free tradewhich not equal in the world


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2.1.2 USAs trading

2.1.2.1 Basic information of USA

Capital City: Washington

Area: 9,826,630 Square Kilometer

Population: 310.3million ) 2010)

Official languages: English

Religion: Protestant, Roman

Catholic

Government: Federal Republic

Prime Minister: Mr. Barack H. Obama

2.1.2.2 Economic

Nowadays, United State of America (US) is the biggest world economy and powerful

of technology in the world. The US has income per capita GDP around 46,900 U.S. dollarsper year The U.S. economy has the system focuses on the market-oriented economy which

is the theory came from Socialist Theory. So, government sector has the policy to encourage

private sector decision-makers in the economy. And has the advantage of flexibility in

investment decisions, labor decisions and new product development more when compare

with the Europes countries and Japan. However, US were disadvantaged in terms of access

to the international market compared with competitors who want to enter the U.S. market.

The long-term problem of US economy include with the lack of investment in economic

infrastructure, the increase in medical costs and retirement benefit funds, trade deficit and

the budget. The goods trade deficit in 2550 was approximately 847 billion U.S. dollars which

is a highest record but declined slightly in 2551 (840 billion U.S. dollars). Due to the value ofmoney was weaker than the major currencies of the world. That makes the U.S. imports

increase and stimulate competitiveness for export. After that in middle of year 2551, the

global economic was downturn, the sub-prime crisis, the collapse of the investment bank.

The housing prices were decreasing. The US launch the fund is called Troubled Asset Relief

Program (TARP) for help the money crisis.

Reference: www.thinkasiainvestthailand.com/

usa_01.jpeg

Figure 2.5: USA Map


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2.1.2.3 Important policy in term of international trade

USA under the president Obama will support the implementation of trade policies to

protect domestic industry. It is say that just like a fairly beneficial and does not cause

damage to the U.S. workforce. Moreover the U.S. still has strengthening the enforcement of

environmental protection standards which are more stringent by summarized as follows.

1. The Doha negotiations that support to make the Doha a success with increasing pressure

the World Trade Organization (WTO). Therefore oversee the implementation of the

national agreement and to stop foreign governments. To take measures to subsidize

exports to America and measures as barriers to trade and non-tariff barriers to exports of

U.S. goods and services.

2. A Free Trade Agreement (FTA) promise that they would oppose trade agreements such to

undermine the economic security of USA. They will fight to open foreign markets to

support the creation of jobs for USA.

2.1 Speak for the negotiation of the North American Free Trade Agreement by

adding content about the environmental protection. Also, warning that it will

withdraw from this agreement, If Canada and Mexico did not agree to open

new negotiations.

2.2 Against U.S. - South Korea Free Trade Agreement, If no amendment of the U.S.

safeguard measures and not opening cars market of Korea to the USA market

anymore.

2.3 Against the free trade agreement with Colombia because of the lower labor

standards.

3. Trade Promotion Authority (TPA) to improve the process of negotiating authority to the

Fast Track to Management. (Give the power to negotiate trade agreements with foreign

countries. Then come to the Parliament for approval. The Parliament can vote only "Yes"

or "No" unable to resolve the details of the agreement) The process that must be

monitored to potential partners to come to an agreement on free trade with USA about

labor and environmental standards. As well as other factors.

4. Offices United States Trade Representative (USTR) to focus on monitoring the application

of the trade agreement of the other partners in strictly designated as a top priority of the

USTR will also add support for both side of budget and personnel for the USTR to conducta more effective accountability.

2.1.2.4 Policies that affect the Southeast Asia

The relations between United States and countries in Asia seem to be a stable but

stagnant in the past few years. Because the U.S. government focusing on preventing the

weapons of mass destruction and the war against terrorism. From the introduction and

implementation of U.S. policy in Asia.


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In addition to the importance of cooperation in the ASEAN ARF APEC and the East

Asia Summit, however, that China and Asian countries have to cooperation in research and

prevention diseases that occur may take APEC to be cooperation, however, the U.S. foreign

policy also, depending on the follow.

1) World situation during the first year of taking. If no other crisis, it was distracting USA willturn attention to the Southeast Asia, 2009 that Singapore will be the head of APEC which

the U.S. president to visit the region in the first year.

2) The persons to be appointed in positions such as the U.S. Trade Representative, Minister

/ Deputy Minister / Assistant Minister / Deputy Assistant who will be responsible of

Southeast Asia. And will play an important role in determining policy towards the region.

2.1.2.5 International trade policy towards the region

USA will strengthen ties with Asian partners, both regional and multilateral levels tobuild confidence security in Asia and the resurgence of the U.S. recovery and the promotion

of trade and the rule of law. Countries should cooperate with USA. To increased domestic

consumption and increasing their imports agreed that the APEC cooperation is beneficial to

the role of USA. In Asia, by open the new trade agreements with USA. They must include

labor and environmental standards. Also open markets for U.S. goods and protecting the

rights of the parties.

2.1.2.6 Policy to ASEAN

U.S. will make relation with countries in Asia (Japan, Australia, the Philippines,Thailand and Singapore) and new partners (Indonesia, Vietnam and Malaysia) and will focus

on ASEAN more. Not only in the field of counter-terrorism and maritime security but

economic, democracy, good governance, sustainable economic development and

environmental protection.

Currently, USA pending the East Asia Summit (EAS) and also expressed regret that

the Government of President Bush ignored the role of regional organizations in Asia. And

open space to China and Russia took the role instead. Recently USA Signed to join the Treaty

of Amity and Cooperation (TAC) in the condition it was in 2009, as well as Australia signed

the TAC in 2005, provided that the TAC shall not affect the obligation of Australia existingbilateral and multilateral, including the UN Charter.


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Figure 2.6: 4th

ASEAN-U.S. LEADERS MEETING

Reference: blog.futureforeignpolicy.com/ASEAN-human-rights.jpeg

2.2 The policy of trading between Thailand and USA

2.2.1 Trade Policy of Thailand

Thailand has 2 policies for trading; there are protective trade policy, and free trade policy

2.2.1.1 The protective trade policy

The protective trade policy is the policy which support domestic product. Then, it uses tocontrol the export for prevent the shortage of product in the country and import product for

support the production in the country. The country can use the protective trade policy by

tariff wall, set the quota, subsidies, dumping, trading condition, and control currency.

2.2.1.2 The free trade policy

The free trade policy is the policy which supports the country to cooperation andtrading together as freedom. The government cannot intervene the trading. The free

trade policy must follow;

1. no have tariff wall2. not collect the tax or collect as the low rate and the same rate3. no privilege and no restriction of trading4. trading with the most product that the country expedient


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2.2.2 Trade Policy of USA

2.2.2.1 USA Policy

1. Support the system of trade ruleThe USA must act follow by the contact in WTO for prevent the right

and benefit of trading in the system of trade rule.

2. Promote for social responsibility and transparency of politicalThe government needs the trade policy which responds to the social.

Then, the government must support the people to have the

participation for comment the trade policy. Also, it needs to establish

advisory sector.

3. Support to have the better environmentThe trade is the important tool for identify the target of energy and

environment. Then, the government needs to respond for the change

of the weather and the resource.

4. The deal of trade will solve the problem which does not terminate atnow

The government responds to problem which from the conflict as

decrease tax. It makes the other effect to the trade. USA concerns

about the measure in country and measure of deprive the trade.

There is the barrier for entry to the foreign market. So, USA willnegotiate for development the transparency. And the government will

seek for opportunity for open new market and protect the artifact and

innovation.

5. The agreement of free trade and treaty of investment as BITs musttransparency

The government will concern with the benefit and stockholder of

trade such as the agreement of trade with Columbia, Panama, and

South Korea.

6. Support to be the partnership with the developing countryThe economic growth of developing country will gain the benefit to

the USA economic. Then, the government will support the policy and

assistance for technical to those countries.


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2.2.2.1.1 Policy / measure of U.S. trade

USA is truly a country importer that supply and consumption goods and used within

the country imports almost all of the trade barriers. USA is to be determined for the trade

true if there is potential in the form of legislation that intended to help protect and promote

the opportunity for competition to the industry in the U.S., the product is the product /same or similar to the level of imports in USA believe that USA will cause damage to the

domestic industry in these measures are being used more frequently. USA is the alleged

dumping and dumping duty imposed for a special case. All of the strategy to trade this way

caused by the introduction of a domestic industry that has been damaged or the unfair

competition from the imports and tactics used by the U.S. government to decide whether it

is true or not dumping. The strategies considered to be beneficial to the parties their best,

however, the measures of USA, most of the countries that are parties to fight hard both in

the form of negotiation with the government and trade Organization (WTO).

Actions of this type will occur from time to time and any one time. Thailand iscurrently facing a range of trade barriers in a way that is recognized widely and has an

impact on Thailand's export trade in most products such as frozen shrimp, which is a major

export product of Thailand.

U.S. law states that a list created with the goal to defend the national economy and

the protection of consumers is important and not a set make a trade but when it is used

that those laws which are the product requirements production management and logistics

strict and thorough insight into the finer details become obstacles and facilitate trade, and

often a smooth block and the opportunity to market the product any several items. A trade

barrier on a mistake of this type occurs, it is very effective and time in a long time anddifficult to cancel or change through international negotiations from all of this legal entities

USFDA (Food and Drug Agency), USDA (U.S. Department of Agriculture) and ATF (Alcohol,

Tobacco and Firearms Agency) is important. The product is more effect of law that

agricultural products, food and drink medicines and health products and beauty products.

Thailand's major products are delivered to market potential in USA (except medical

products).

Decentralize system of government in USA is make trade barriers, both performed

by the intended and unintended consequences of the legislation is aimed at protecting the

country and the consumer that can occur frequently that effect or enforcement throughoutUSA and specific to each area. These laws have become a trade barrier or some products

from certain countries or through instilling fear and resistance in the supply of goods or

merchandise to the consumer such as law Preposition 65 in the state of California and the

warnings of the dangers of lead residues in various ceramic and porcelain or quantity and

warning of the dangers of mercury that residues in food.


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2.2.2.1.2 Trade agreements

USA has a trade agreement as follows;

1. Global trade agreements that action with the International Trade Organization, WTO.

2. Regional trade agreements.

2.1 Free Trade Area of America (FTAA)

2.2 ASEAN Initiative

2.3 North American Free Trade Agreement (NAFTA)

2.4 Middle East Free Trade Initiative (MEFTI)

2.5 Asia-Pacific Economic Cooperation (APEC)

3. The agreement between two parties.

3.1 Foreign Trade Agreement FTA and

- Australia

- Bahrain

- Chile

- Israel

- Jordan

- Malaysia

- Morocco

- Oman

- Panama- Singapore

- South Korea

- South Africa Customs Union-SACU FTA

- Central America- Dominican Republic (CAFTA-DR FTA)

3.2 Bilateral Investment Treaties (BITs)

3.3 Andean Trade Promotion Agreement TPA

- U.S-Central Asian (Kazakhastan, Kyrgyzstan, Tajikistan,

Turkmenistan, Uzbekistan)

3.4 Trade and Investment Framework Agreement (TIFAs)

- Columbia Trade Promotion Agreement

- Peru Trade Promotion Agreement

- U.S-Uruguay BIT

- U.S-Common Market for Eastern and Southern Africa

(COMESA) TIFA

- U.S.-West Africa Economic and Monetary Union (WAEMU)


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TIFA

- U.S.-Afghanistan TIFA

- U.S.-Algeria TIFA

- U.S.-ASEAN TIFA

- U.S.-Australia TIFA

- U.S.-Bahrain TIFA- U.S.-Brunei TIFA

- U.S.-Cambodia TIFA

- U.S.-Ghana TIFA

- U.S.-Indonesia TIFA

- U.S.-Kuwait TIFA

- U.S.-Lebanon TIFA

- U.S.-Malaysia TIFA

- U.S.-Mauritius TIFA

- U.S.-Mozambique TIFA

- U.S.-New Zealand TIFA- U.S.-Nigeria TIFA

- U.S.-Pakistan TIFA

- U.S.-Philippines TIFA

- U.S.-Qatar TIFA

- U.S.-Saudi Arabia TIFA

- U.S.-Singapore TIFA

- U.S.-South Africa TIFA

- U.S.-Thailand TIFA

- U.S.-Tunisia TIFA

- U.S.-United Arab Emirates TIFA- U.S.-Yemen TIFA

2.2.2.2 Agreement under WTO

The agreement under the WTO has 3 types;

1. Open the market1.1 Deduce custom duty of the industrial product (include fishery product)

- Every country reduce the duty as 33 percent within 5 years (begin inJanuary,1995)

- Do not collect the special fee, if it still no have fee or does not specify before1.2. Agricultural product

- Every country must cancel the measure of forbid to import and use customduty substitute as those measure

- Reduce the duty as 36 and 24 percent by reduce at least 15 and 10 percentin each product within 5 and 10 years for developed country and developing

- Decrease to support the agricultural product in the country and export


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1.3 Textile

Open the free trade of textile and clothes instead of Multi-Fibre Arrangement:

MFA by;

- Cancel the limit of import under MFA in 10 years- Expand the quota of import product which did not enter to GATT as

continually since 1995

2. Rule of tradeAdjust and determine of the important trade rule such as;

- Agreement of the measure which relates with sanitation and sanitation ofplant; allow the member country to determine the level of safety and

verification of the import product.

- Agreement of retaliation for dumping; set the method and the way toinvestigate the country which dumping in the market.

3. OtherAgreement for operation which GATT did not set rule before. There are;

- Intellectual property of TRIPS; set the scope and the method to prevent theintellectual property such as patent, trademark, right of design, integrated

circuit, geographical indication, and trade secret.

- Trade in service; set the normal agreement of trade in service by the methodwhich the same as GATT. For example, principle of non-discrimination,

transparency, and slowly of liberalization.

- Measure of trade that relate with TRIMs; to set the important method suchas every county must cancel the measure which deprive the import. The

developed country need to cancel as 2 years and developing country need to

cancel as 5 years for local content requirement.

Therefore, the trade policy of Thailand and USA are related with free trade and

agreement of WTO but it has some restriction too. However, Thailand and USA still to use

protective trade policy to control the goods in domestic. If the country import or export a lot

of product, it will have the problem with economic.


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2.3 The important situations that make the problem occur with the trading between

Thailand and USA

The relationship between Thailand and the USA begin from the trading in early 19th

century. In 1833, there is the contract of sale between Thailand and USA. Later in the year1856, during Rama IIII, it had the formal establishment of diplomatic relations between

these two countries. Then, Thai international trade was rapid expansion. However, the USA

merchants still did not trade with Thailand that much because Thailand is too far away and

the journey was inconvenient.

During World War 2 (1939), Thailand and USA has a close relationship with each

other and change relationship from ordinary to a special friendship. That is because USA

become a major superpower after the war and they prescribe new economic policies. As a

result, Thailand had increased the export to USA.

In 1980,Thailand began to increase the economic development and also USA beganto reform its economy which is to make the trading policy in an aggressive way. In the late

1980s, USA have legislated the new trading law, Omnibus Trade Bill.

In 1985, there is the conflict between Thailand and USA, also in the trading and

exporting parts. These conflicts were continued for 10 years. USA almost is the one who

threatening to cancel the Generalised System of Preferences, GSP since 1976 without any

conditions.

First generation of GSP was expired in 1984. USA had adjusted policies about GSP byset the countries which will receive the benefits under the GSP as the second generation.

That is because the expanding of exports from Thailand to USA has growth up as 30 percent

per year. It makes the risk that Thai product will be cut out from GSP is very sensitive as the

overall.

The next important event is The Tom Yum Goong crisis in 1997. It is the period that

the foreign policy was changed to USA. It is because when the economic crisis happened,

USA started to be important to Thailand again. Thailand receive the support from USAs

economy about 2billion USA dollars. Also, the export from Thailand to USA had increase as

354, 553million baht, about 39.7percent.

In 2001, FTA was based on the basis of mutual benefits (win-win situation). FTA will

increase the opportunities for exporters. In the view of the manufacturer, some group can

produce and export more because the duty tariff of FTA agreement with the USA. However,

later on when Thailand was abolished in 2005 with the coup on 19 September 2006, the FTA

between Thailand - USA was stopped.

In 2007, the USA economic market became slowed. Thailand exported shrimps to

USA decreased about 7.58% in the same period of last year. As a result, the purchasing

power of consumers in country has decreased as well.


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In 2011, President Obama had a trip to Asia in order to "open up markets and

increase the exports to USA" and the problem of unemployment in the USA also has not

been improved. Nearly 15 Million peoples in USA were still unemployed. Moreover, the

unemployment rate remains high at 9.6%. For USA, the domestic consumption has a high

proportion of GDP. So, if the highest unemployment is too high and people concerned that

there will be no future income in the future. It will make the consumption become lower.Also, the imports will be reduce as well because USA still import Thai goods especially rice

and frozen shrimp as number one.

In 2010, there is the flood in Thailand. From the report of Fisheries Agency of the

National Oceanic and Atmospheric Administration (NOAA), it told that the imports were

decrease 3.4% as123.3 million pounds. The main reasons become from the scarcity of

shrimp from Thailand as due to flood. This affects both of the production, distribution of

goods and others because USA imports shrimp from Thailand the most.

The latest situation as Obama visited Thailand after receives the position. Mr. KositPunpiumrath, the president of Bangkok Bank Public Company (Limited), said that the visit to

Thailand of Mr. Barack Obama, President of USA believe that it good for the negotiations of

the strategic partnership in Trans Pacific Partnership (TPP). Especially, to export the product

to the new markets in Thailand that USA never negotiates about trade with Thailand before.

At a present, the trade between Thailand and USA has 10 percent continued to grow

normally. Nowadays, the trade has continually negotiating between Thailand and USA.

2.4 The Politic of Thailand and USA

2.4.1 Politic of Thailand

Thailand under prime minister Yingluck Shinawatra after flooding in last year and the

problem of conflict about people who are different opinion. It make other counties look

Thailand is not secure of politic. This point it is make Thailand must solve the problem inside

the country along with relationship to other countries and return to the normal satiation

and promote trade in the region and expand export into economic base.

2.4.1.1 Policy on Foreign Affairs and International Economic 2011

1. Expedite the promotion and development of relations with neighboring countries by

enhancing cooperation between the public sector, private sector, people and the mass

media in order to cultivate mutual understanding and instill closeness among all sectors

which will lead to expanded cooperation in the areas of economics, trade, investment,

tourism promotion, transportation and others under sub-regional frameworks so as to

promote good neighborly relations.


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2. Create unity and promote cooperation among ASEAN countries in order to realize the

goal of creating an ASEAN Community, as well as promote cooperation with other

countries in Asia through various cooperative frameworks, and prepare all sectors for

the move towards becoming an ASEAN Community by 2015 in the economic, socio

cultural and security areas.

3. Take on a creative role and promote the national interest in international organizations,

specifically at the United Nations and regional organizations in order to preserve peace

and security, promote the democratic process, human rights, humanitarianism, the

environment and sustainable development, as well as cooperate to address all

transnational issues that affect human security.

4. Strengthen cooperation and strategic partnership with countries, groups of countries and

international organizations that play important roles in global affairs in order to boost

confidence in Thailand, as well as build capacity and immunity for the Thai economy.

5. Encourage people-to-people contacts with foreign countries, as well as promote a

positive image and technical assistance with developing countries so that people,

governments and the international community will have positive attitudes toward the

Thai people and Thailand.

6. Promote public awareness and understanding of border issues and global changes that

affect Thailand so as to forge consensus in the formulation and implementation of

foreign policy.

7. Support People Diplomacy to safeguard the interests of Thai nationals, as well as protect

Thai nationals and Thai workers abroad, specifically those employed and living overseas,

in addition to strengthening and promoting the role of Thai communities in preserving

their Thai identity.

8. Utilize regional connectivity within the ASEAN region and sub-regions in order to expand

the economic base in terms of production and investment, prioritizing the development

of provinces and groups of provinces situated along the economic corridors and border

areas.

9. Coordinate the work of government agencies overseas in accordance with the Team

Thailand policy in order to carry out foreign affairs efficiently, effectively and with high

quality.

10. Promote close cooperation with Muslim countries and Islamic international

organizations to create a correct understanding that Thailand is working on resolving

the issue of the Southern Border Provinces, as an important internal issue, by

following His Majesty the Kings advice to Understand, Reach Out and Develop.


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2.4.2 Politic of USA

Politics in the U.S. just came through an election. The results of the election that the

president Barack Obama's presidency is that of the 2nd. President Barack Obama focused on

the issue in the country because economic problems in USA. In 2012, President Barack

Obama was visit to Asia for make trade relations with other countries of Asia and treat thebalance of trade in China between Asian. It shows that USA aware of the importance of

other countries in Asia.

2.4.3 Relation between Thailand and USA

After the situation of September 19, 2006 USA has no interaction with the Minister

and the suspension of military aid. However, the relationship was back to normal quickly

after the election in USA.

In 2008 was the year of the 175th anniversary year of the Thailand - U.S. that 2countries have used the chance for promote the relationship between the 2 countries from

activities focused on understanding and feeling good at all levels including the promotion of

relations between citizens of both countries.

In 2009 by the exchange of ministerial Minister of Foreign Affairs and Chancellor of

the Exchequer visit USA on April 2009, Ministry of commerce visit to the U.S. and March

2009 Chancellor of the Exchequer visited USA. In June of 2009 Minister of Foreign Affairs

Mrs. Hillary Clinton visited Thailand to attend the meeting of the 42 ASEAN Post Ministerial

Conference and 16th ASEAN Regional Forum (ARF) in Phuket. In July, 2009 has bilateral

meeting with the Prime Minister and Minister of Foreign Affairs. It has activities and makesconfidence of Thailand within USA of The Prime Minister in the occasion of the 64th UN

General Assembly meeting in New York in September 2009, that which has make the

confidence of the business and the public sector.

In April 2010, President of Trade Representative Thailand as the special

representative of the Prime Minister visited to the U.S. and clarifies the political situation in

Thailand in June 2010

2.4.3.1 Ally Thailand USA: Past and Present

Lohman has analyzed the relationship between Thailand and USA and its allies have

been the following 5 part.

2.4.3.1.1 Economy

Thailand is a major trading partner of the U.S. trade in 2010 amounted to nearly

32,000 million and it make Thailand is a country which ranked the 23 states of the U.S.

investment in Thailand in 2010, with nearly 13,000 million.


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Thailand and USA have the Treaty of Amity and Economic Relations Under the treaty.

Under the treaty the U.S. companies is equivalent than Thailand companies. The U.S. is the

only country that has this right; however, U.S. exports to Thailand still having the problems.

Particularly with regard to tax measures, while China's FTA with Thailand is an opportunity

for trade with China and Thailand. China is a more advantage to USA, although in 2004 the

FTA negotiations between Thailand and USA. But the negotiations were interrupted since acoup in 2006; although the USTR will not have an official release that the possibility of

resurrecting the FTA between Thailand and USA but recently, Senator Richard Lugar,

Republican of African has presents the motion for urged the USTR negotiations with FTA and

ASEAN.

The article of Lohman in the Heritage Foundation has analyzed 2 major challenges

for the Alliance Thailand - U.S. that the first is the political turmoil in Thailand and the

second is the rise of China.

First, Thailand's political turmoil that it is many parties in the U.S. has the questionabout the benefits of the alliance between Thailand and USA. Dependence on Thailand as

ASEAN channel has been destroyed and loss more the credit in ASEAN. It makes Thailand's

political efforts to revive the alliance Thailand - United States is limited by the political

leaders of Thailand, which is not the real leader of Thailand and no coordinator for

relationship between Thailand and USA and no person who interact with the leaders of USA.

And the last, the challenges for the alliance between Thailand USA is the rise of

China. Thailand and USA are the view that the rise of China all together. The strategy of U.S.

is to block the expansion of China influence in the region. USA regarded that China is likely

to be a threat. But while Thailand look back to the rise of China as an opportunity ofeconomic and political in Thailand that China is offering to Thailand.

2.4.3.2 Ally Thailand USA: The Future

Heritage Foundation has proposed that USA government that should strengthen the

relationship between Thailand and USA and revive the alliance between Thailand and USA.

The proposal as follows;

2.4.3.2.1 Enhance relationships

The two countries should enhance the exchange of high-level bilateral visits of the

past. Leaders of the 2 countries will meet in a multilateral forum ASEAN or APEC. It is

making the organization to enhance Thailand USA will occur.


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2.4.3.2.2 Focus on mutual benefits

To reviving allies should aim to cooperate with mutual benefit, such as protecting

international trade, promote democracy for stability in the region, military cooperation for

cooperation in the fight against terrorism, so the two country can work together to make it

meaningful. Thailand USA should enhance the bilateral of Thailand USA such as the US-Thailand Strategic Dialogue, which in the present that discussed in the secretary of state and

the director-general. They should raise the level of Foreign Ministers and the present has

meeting in 2 times per year, then there should be change a meeting once a year.

2.4.3.2.3 Revive negotiations FTA of Thailand USA

Negotiations FTA of Thailand - USA, which halted after the 2006 coup, it should

return to negotiations together. When the government of Thailand already and USA should

be invited to participate in the FTA of Thailand by the U.S.. USA pushing the region is the

Trans-Pacific Partnership, or TPP, the U.S. policy makers must not forget that Thailand Trade- China has increased significantly after the two countries have doing FTA , so the U.S. will

have to negotiate FTA with Thailand. Otherwise USA would be disadvantaged with China.

2.4.3.2.4 Critic

If Obama's government amenable to these proposals and adjust policies to Thailand

and revive relationship with Thailand follow those proposals. Thailand will benefit greatly.

The main issue is the upgrade of relationship that the proposed Obama visited Thailand to

enhance US-Thailand Strategic Dialogue. It is the way to use Thailand channel to ASEAN and

to revive the FTA Thailand USA.

However, the major obstacle to closer ties Thailand USA is conflict and political

turmoil in Thailand that uncertain future and other factors that are obstacles that the U.S.

strategy for the region is different from the past from Hub and spokes system that focuses

on 5 countries (core partners) in the U.S., but now the new strategies that are more

intricate. Multilateral framework has been extended more. At the same time USA has been

extended to partners from the same country, but now there are only 5 states are close to

many other countries in the region, especially Indonesia and Vietnam. It make USA has more

options and Thailand has less important to USA, while Indonesia and Vietnam are likely to

be more important to USA.

In 2012, President Obama's visit to Thailand and have made several agreements on

the Trans Pacific Partnership (TPP) is a part of the military and security matters that the

relationship between Thailand and USA, which has ties in trade and security. Especially

when viewed from the frame of the TPP and the military.

Trans-Pacific Partnership has objective for promote the establishment of free trade

area between them faster.


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2.4.4 Critic (Strategic of Thailand to USA)

Obamas government has pushed for the establishment of the new FTA with the

name as call Trans-Pacific Partnership or TPP. TPP has high standard more than FTA and it

will be the most advanced. There are plans to expand the number of members from 9

countries to expand coverage in the Asia-Pacific region. TPP will become the largest FTA inthe world. In the past the U.S. is lobbying nations to join the TPP, including Thailand.

Objective of TPP is protecting USA from the rise of China economic and integration

of countries in the region.

2.4.4.1 Impacts of Thailand from TPP

Benefit of TPP, Thailand will be FTA with USA but the point is we have to negotiate

FTA with USA during the Thaksins government although we may be able to benefit from the

export of certain goods to USA. It has many branches that are disadvantage such as inparticular, the commercial sector, intellectual property, and linking trade with labor

standards and the environment.

In summary, USA would more benefit from the establishment of TPP but Thailand is

not anything substantial and many negative from TPP.

2.4.5 Conclusion: Politic of Thailand effect to USA

In conclusion, Politic of Thailand has more effect to USA because the problem of

conflict politic in Thailand. It makes the contract between Thailand and USA stop ordisruption. Also, the law of Thailand is unclear then it makes Thailand loss opportunity for

trading with USA. Moreover, USA has hidden benefit to trading with Thailand for control the

balance of China power. Then, it affects to the TPP agreement which Thailand will lose the

benefit of trade with USA and Thailand may have the conflict with China too.


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2.5 FTA between Thailand and USA

2.5.1 Free Trade barrier between Thailand and USA

The Rate of non-tariff barriers in Thailand and USA;

Thailand take measure about non tariff barriers with goods import from USA about

14.10 %.Which the production has a high level of obstruct such as the other cereals

(100.00%), vegetable, fruits and beans (94.07) ,ranch (83.12%),product of domestic animal

(77.80), product of meat (95.78%) , sugar (29.17%),product of foods (62.74%), clothes

(38.01%) , product of woods (33.29%), other industry (28.99%)

Figure 2.7: Textile

Reference: http://www.bsnnews.com/news/index.php?NewsID=8565

0-2011042563401Z7.jpeg

USA take a measure about non-tariff barriers with goods import from Thailand

about 87.38% which the production has a high level of obstruct such as vegetable - fruits

and beans (96.37%), other vegetation (73.54),product of domestic animal (94.38),product

of meat (100.00%), Milled rice (98.31),product of foods (99.38), textile (83.10),clothes

(97.25), product of wood (56.76). So, you can see that product of agriculture and have many

types about high hinder to processed products from agriculture of Thailand

The analysis found that USA have free trade barriers with Thailand which main issue

of Thailand get effect from free trade barriers is the export of Thai foods to USA

Black tiger prawn: In 2002 2003, Thailand export a lot of black tiger prawn to USA

and price lower than the domestic price .Made to USA black tiger prawn dumping filed of

Thailand in 2004 and after, the export in Thailand to a halt and make to the export to lose

more than 20,000 million Baht or 40 % of all black tiger prawn export of Thailand.


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Figure 2.8: Black tiger prawn

Reference: http://news.sanook.com/917711/%/koong.jpeg

Canned pineapple: USA is the main export market of Thailand always but in 10 years

ago Thailand's exports of canned pineapple is decreased. Since the year 1996 - 1998 is

worth about 5,763 million Baht. It has reason from USA take a measure of Thailand canned

pineapple anti-dumping and cause comparative advantage reduce and cant increase

market because The loss of income from market more than 1000 million Baht and exports

decreased to 120,000 tons.

Figure 2.9: Canned Pineapple

And then, the one point to make Thailand that is affected about generalized system

of preference is generalized system of preference for Tax-Deductible to developing

countries and Thailand get it right .But Thailand comparative Advantage about foods has asignificant impact such as

Thailand takes to debar from generalized system of preference about cannedpineapple in Europe while Kenya gets it right

Thailand takes to debar from generalized system of preference about shrimp inEurope which cant Increase the shrimp market.

Reference:

http://www.oknation.net/blog/print.

php?id=848290/615609330.jpeg


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USA define Non-Tariff Barriers is Food Security Act of 1985, trade and ability to

compete measure of 1998 and other measure of USA create for Control of health care and

Environmental conservation have effect to export from Thailand to USA. Especially, Product

about sea foods and Ready-to-wear which in turned around are if USA take these measures

make Thailand export to market of USA decrease but 3 trade barriers of USA that havent

affect to rice export which USA is largest rice exporter of the world inferior to Thailand andrice import from Thailand are high quality and it difference from rice of USA. For the

antecedent are National income of USA found that if revenue of people in America increase

as Economic theory says that when the revenue increased, demand for consumer goods will

increase. As a result, they have benefited from Thailand market export and make to the

demand of U.S export increase such as Agricultural crops, Beverage, tobacco and others

industries.

2.6 Non-tariff

Form of barriers of trading between Thailand and U.S.A.

Thailand has export many type of products to USA. When Thailand has export the

products to other country they must has problem about barriers of trading in import

country. The barriers of trading have many types, so in our products have effect in some

type of barriers of trading. In first type is Sanitary and Phytosanitary : SP is process for set

the safety standard that make more barriers for import. The case of Thailand has the

problem about export to USA. That product is shrimp because in the past Thailand met the

problem that find the lead inside the shrimp. From this reason make to USA focus on safety

standard of shrimp of Thailand.

About other barriers trading type is Anti-Dumping: AD is barriers to add the tax for

import. The product that Thailand has effect such as; Shrimp and Canned pineapple. In

Thailand is one main factory for produce the part of electronic for export to other country,

but many times that Thailand has problem about pirate, so the USA to focus on Technical

Barrier to Trade: TBT for this type is set the standard of trading and it can be an barriers in

commerce.

Once kind of barriers of trading is Labor measures. This kind set for protect the hire

child labor and outsider labor. So, the USA focus on this problem because in Thailand hasmain problem about some factory hire child labor and outside worker in low rate. In main

problem in Thailand are many factories hire child labor in low rate


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2.6.1 Type of barrier for trading between Thailand and USA

The export goods from Thailand to USA have many categories. If the product has

export as large amount, USA will set the barrier for obstruct the import product. Then,

Thailand has a big problem with Penaeus monodon in 2002-2003. USA has the security

barrier with Penaeus monodon by use sanitary and phytosanitary(SP) measure to examinethe food safety. It is the way to increases the trade barrier; for example, USA use sanitary

and phytosanitary to check the lead in the shrimp from Thailand. Also, they have another

barrier such as Thai labor measure which uses child labor or not. In addition, USA increases

the import tariff to anti-dumping as canned pineapple, shrimp.

The electronic circuit board from Thailand has the barrier as Technical Barrier to

Trade (TBT). There is the measure which use to determine labeling and packaging as high

quality. Then, it affects to Thais electronic products because Thailand has the problem with

intellectual piracy and the labor which include the child labor and illegal labor. So, the

industries that have the problem with technical and labor barrier are canned food and

textiles.

Figure 2.10: The process in Shrimps

factory in Thailand

Reference:

http://ambkristie.us/page/10/tumblr_lqubfqhv601qg5vj3o1_500.jpeg


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2.7 Market Share of Thais export goods

Table 2.2: Export of consume product in 2007

Dollars Percentage of expansion Percentage of proportionRice 3,467.43 34.24 2.25

Canned seafood and processed food 3,165.46 6.43 2.06


Dollars Percentage of expansion Percentage of proportion

Rice 6,204.08 78.92 3.49




Rice 5,046.46 -18.66 3.31

Canned seafood and processed food 3,718.27 -4.80 2.44



Rice 5,341.08 5.84 2.73




Rice 6,507.47 21.84 2.84


Reference: Information and Communication Technology Office, Office of the Permanent

Secretary Ministry of Commerce.

http://www.ryt9.com/s/beco/1328517

Conclusion: Market Share of Thais export goods

In year 2009, percentage of expansion is decrease because in Thailand have problem

about the political. This problem made USA not belief in Thailand. It is effect to the export

goods of Thailand directly. After that, when this problem was solved by new government

the situation of export goods in Thailand was better.


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2.8 Why does Thailand do Free Trade Agreement: FTA? What are the benefits?

In the present, the world market competition is very strongly.

Thailand needs to depend on international trade more. In the international, toimport goods is harder, both of the tariff threat and the others like tariff that limit the

quantity of imports good. In many countries improved the quality of producing more

products. For an example, in 2012, the exporting of Thai Rice product becomes more severe.

As come from India which tries to send their white rice and stream rice again after they

stopped for three years. This makes a result to Vietnam who is the main competitors need

to reduce the price of exporting white rice as to compete with India. However, the price of

exporting Thais rice is still at high as compares to other countries. So, the countries that

always buy rice prefer to import rice from India and Vietnam more than Thai. Thats why it

makes the exporting of Thais rice decreasing, as compare to 2011 which is the highest year

of exporting of Thais rice.

The export is the important part to drive Thai economics. So Free Trade Agreement

is important for helping to keep old market and expand trading for new market. More

opportunity to export Thai best quality goods and service. Reduce tariff barrier and non-

tariff barrier. Reduce uncertain Generalized System of Preference: GSP. Then, attract

foreigners to offshoring and more investment in Thailand while support Thai people to

invest in abroad. Push forward to expand economic cooperation in term of export so

Thailand has to work in two parts in the same time. First part is penetrate the market /

promote exporting, in another part is reduce trade barrier of enter to the competitor

markets so we must to negotiate step by step for reduce trade barrier. In 20 years ago thenegotiation was GATT/WTO by 100 members together (Now WTO has 153 country

members). In 10 years ago the negotiation changed from WTO to FTA such as EU, NAFTA,

EU-Mercosur, and FTA between countries. Thailand need to negotiate for keeping margin of

Thai competition to not be adverse the competitor markets because they will get extra tariff

measure or non-tariff measures more than Thailand. Not only more distribution channels

goods to nearby region such as India to make them as offshoring to the countries in South

Asia, but also reinforce investment for increase the numbers of foreigner investor in

Thailand and support Thai people to invest in abroad. More international alliances for more

strong power of world negotiation. And finally, the consumption will get better consume

and more choices to select the diversity and cheap goods.

We found the points as below;

Export-driven : Market access

Reduce trade and investment barriers.

Expand investment.

Inflows and Outflows.

Cost reduction/ Resource-seeking.

International alliance and Capacity-building.

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international trading problem between thailand and usa by big poop-pup double extra

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