Potential impact of Thailand-Australia Free Trade Agreement on Thailand

Thailand, as a major trading nation, has been entering into trade agreements for centuries. Over recent years there has been an emphasis on an ever increasing number of bilateral and multi-lateral free trade agreements (FTAs). One of the social impacts of any change in the economic structure of a country is the negative impact on some sectors of the economy. Thailand entered into its first Free Trade Agreement with a developed country in 2004 when it joined with Australia to form the Thailand-Australia Free Trade Agreement (TAFTA) which covers trade in both goods and services. Opening of markets can have both beneficial and detrimental effects on the livelihoods and social fabric of the member countries. TAFTA addresses the potential issue of social dislocation by allowing Thai industry time to adjust to the changed trading environment. This paper will show that overall, TAFTA will have a positive impact on the Thai economy largely in part to the complementarity of the Australian and Thai economies and the changes required to the Thai legal and administrative frameworks to be competitive.