16 Dec 2019
THAILAND: Hong Kong Free Trade Agreement Feasibility Study Given the Go-Ahead
A mooted Free Trade Agreement (FTA) topped the agenda at the recent Thailand-Hong Kong Special Administrative Region Summit, with the proposed treaty expected to extend across the services sector, with a particular emphasis on green finance and-cyber security. With a pre-negotiation feasibility study expected to begin in February next year, it is believed formal talks will commence in 2021, with a view to having the agreement in place by 2023.
The two sides also a signed a Memoranda of Understanding (MOU) regarding closer economic relations via cooperation in a number of areas, including trade and investment, enterprise partnerships, the creative industries, financial services, technology start-ups and human resource development. Five further MOUs were also signed between various agencies representing the respective territories with a view to strengthening cooperation across a range of fields, including the design and creative industries, trade and investment and innovation/technology.
The two sides also agreed to step up cooperation in the financial sector via the cross-listing of securities on their respective stock exchanges. Moves to revise and upgrade the mutual Investment Promotion and Protection Agreement, which dates back to 2005, were also approved. The aim of boosting bilateral trade from its current level of US$15 billion at present to $20 billion by the end of next year was also agreed during the course of the summit. The possibility of a higher number of Hong Kong companies relocating their production facilities to Thailand – as a means of avoiding the punitive tariffs stemming from the ongoing US-China trade dispute – was also addressed.
Thailand is Hong Kong’s third largest export market in the ASEAN bloc after Vietnam and Singapore, with both sides already FTA partners under the terms of the ASEAN-Hong Kong, China Free Trade Agreement (AHKFTA).