Bilateral free trade will not necessarily lead to an increase in rice-trade volume, the chairman of a committee looking into free-trade agreements told a seminar yesterday.
Growth in global rice trade will not reach more than 7 per cent, or 400 million tonnes, a year due to the volatile market, Narongchai Akrasanee told the "More Free Trade: An Impact on the Rice Sector" seminar at the Thailand Rice Convention 2004, at the Muang Thong Thani Convention Centre.
Narongchai said free-trade agreements (FTAs) had had very little impact on the rice trade in general. However, the biggest impact of FTAs would be seen in trade with China, Australia and Asean (Association of Southeast Asian Nations). "We can use bilateral FTAs to bargain for other concessions with our trading partners such as Japan and the US," he said.
It would also be possible to organise rice trade cooperation under the Bangladesh, Bhutan, India, Burma, Nepal, Sri Lanka and Thailand Economic Cooperation, he said.
Rice has been included in free-trade agreements such as the Asean Free Trade Area (Afta) and with other partners, Narongchai said.
Under Afta, rice is on the highly sensitive list, with the final tariff rate in 2010 set at less than 5 per cent, he said.
Meanwhile, rice is on the agenda for FTA talks on tariff reduction with Bahrain, China, Australia, Japan and the US.
Protectionist actions such as Japan putting rice on the "sensitive" list and the US implementing export subsidies and domestic support for rice may affect thesmooth passage of FTA negotiations, Narongchai said.
In contrast to Narongchai's comments, the director-general of the Department of Trade Negotiations, Apiradi Tantraporn, said bilateral talks should have a positive impact on the rice trade. But she added that the pace would be slower and more difficult than progress made in multilateral talks under the World Trade Organisation framework.
"Rice is a sensitive product. Whether the market is more liberalised or not, people will still consume it," she said.
The Rice Exporters Association of Thailand president Vichai Sriprasert said that free trade might benefit the rice trade in the sense that the market would be more open for trade.
"However, the FTAs would not help much since we, the exporters, still have to depend on our own efforts to increase trade volume," he said. Thailand is the world's exporter of rice with volumes for this year projected by the Ministry of Commerce to reach 8.5 million tonnes.The Nation:
