Thailand's economic prospects look increasingly promising as the government prepares to expand its free trade agreements (FTA) to bolster exports, especially amid the growing intensity of global trade competition. According to the Department of Foreign Trade, the export value under FT agreements for 2024 is reported to be around $83.29 billion, representing approximately 2.83 trillion baht. This marks an increase of 2.05% from the previous year, indicating the strong utilization of FTA privileges by Thai exporters.
Director Arada Phuengthong emphasized the importance of these agreements, stating, "The use of FTA rights is expected to help reduce tax costs, which can create competitive advantages for Thai exporters, especially during intensified international trade conditions." The Department has indicated plans to finalize three additional FT agreements this year, including negotiations with Sri Lanka and the European Free Trade Association (EFTA), which consists of Switzerland, Norway, Iceland, and Liechtenstein.
Details of the previous year's export performance under various FT agreements show significant contributions from ASEAN countries, where the highest export value was recorded at $31.4 billion from the ASEAN Trade in Goods Agreement (ATIGA). This was followed by exports to China, Japan, India, and Australia, reflecting Thailand's strong trade relations within Asia. For example, exports to ASEAN-China under the ASEAN-China Free Trade Area (ACFTA) reached $22.58 billion, achieving an impressive utilization rate of nearly 90%.
The push to negotiate additional FT agreements stems from the Thai government’s strategy to provide manufacturers and exporters with the tools necessary for greater international competitiveness. Indeed, Arada noted, "We expect to have three more FT agreements signed this year, including the agreements with Sri Lanka and EFTA countries." These future agreements are projected to facilitate even more favorable trade conditions, enhancing market access for Thai goods.
The substantial export gains also reflect the growing demand for Thai products, particularly agricultural exports. Among the leading products exported under FT agreements, automotive parts have seen notable performance, along with agricultural products such as fresh durians. The increasing volume and value of exports within these categories highlight the shifting dynamics of international trade.
There is also growing confidence among Thai producers and exporters as the Department of Foreign Trade continues to offer support and information services. Local businesses can leverage these FT agreements to navigate the competitive international marketplace, especially considering the lower tariff barriers afforded by such agreements. This strategic positioning is expected to resonate well with Thai enterprises aiming to deepen their market penetration.
Challenges remain, particularly with the advent of new regulations and potential trade barriers posed by other countries. The Thai government is actively working to tackle these challenges through consistent dialogue with trading partners. For example, new requirements from the Chinese market have emerged for durian exports, which mandate testing for certain chemical residues. Cooperation between the Thai agricultural sector and the government continues to mitigate such risks.
Toward the end of 2025, it will be interesting to observe how these additional FT agreements impact Thailand’s trade balance and overall economic growth. The increased participation of Thailand in FTA networks is aimed at reinforcing its stature on the global stage, opening up new markets and enhancing the competitiveness of Thai exports.
With the government emphasizing FTA engagement as part of its national strategy, producers and traders alike are encouraged to continue exploring these beneficial arrangements. Effective collaboration and proactive measures will be key to ensuring the sustainability and growth of Thailand's export economy. Moving forward, building on the cooperation through FT agreements will be pivotal as Thailand navigates the complex waters of international trade.