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Thailand Negotiating ‘Worrying’ Deal With EU



EU Council President Herman Van Rompuy (R) welcomes Thai Prime Minister Yingluck Shinawatra


BRUSSELS – The negotiations launched this week for a Free Trade Agreement (FTA) between Thailand and the European Union have raised concerns among both Thai and European non-governmental organisations, who fear that EU demands could have a negative impact on Thailand’s progressive public health policies.

Launched during Thai Prime Minister Yingluck Shinawatra’s visit to Brussels on Mar. 6, the negotiations will include the Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement, an international accord that lays down rules for dealing with intellectual property such as branded medicine. If the EU pushes the interests of its pharmaceutical companies, access to generic drugs in Thailand could be at risk, according to some NGOs and European parliamentarians.

“The interest of big pharmaceutical companies is to have a higher price for their medicine, and the interest of a state such as Thailand is to have access to generic medicine that is cheaper, so there’s a real issue,” Leila Bodeux, a Brussels-based spokesperson for Oxfam told IPS.

“It’s very important to consider that Thailand has made a great deal of effort to improve its public health system and now has a universal health scheme. But for the scheme to function well, it has to rely on affordable medicine.”

Oxfam and other groups including Dutch-based Health Action International (HAI) and Action Against AIDS Germany say that excessive intellectual property protection and enforcement can restrict makers of generic drugs. The consequence is that market monopolies are propped up, with high prices for medicine, thus “affecting access to affordable treatment.”

Thailand has gained international admiration for its public health programme which is based on providing inexpensive medicine to its population, says Oxfam, which works to eliminate poverty around the world. In the treatment of HIV/AIDS, the Asian country has managed to provide antiretroviral therapy (ART) to 80 percent of those living with the disease.

The fact that most ART drugs are produced by India for other developing countries has reduced the treatment’s cost enormously.

But activists say that these advances could be rolled back by the Free Trade Agreement, particularly if the EU introduces “investor-state dispute provisions” in the FTA.

NGO leaders point to the case of U.S. pharmaceutical giant Eli Lilly & Co. which has brought a lawsuit against Canada under the North American free trade agreement, demanding 100 million dollars in compensation for Canadian court rulings that stripped the company of its patent for medicine used to treat attention-deficit disorder. Thailand could find itself in a similar position to Canada if makers of generic drugs are seen to infringe existing patents, warn NGOs.

“We are particularly worried that the EU will push to have intellectual property provisions that go beyond the TRIPS agreement,” said Bodeux. Such provisions, known as TRIPS-plus, may have the support of multinational drug firms but would be detrimental to the Thai public health budget, Oxfam says.

Bodeux told IPS that the EU may try to seek a longer “patent term” for drugs than the current 20 years agreed under World Trade Organisation rules. In addition, the EU may request “data exclusivity” provisions, which means that Thailand would not be able to give out certain clinical trial information during a specified time frame.

The European Commission says that the launch of FTA negotiations “marks an important step in EU-Thai relations, already strengthened by a Partnership and Cooperation Agreement.”

The Commission stated that the aim “is to conclude a comprehensive agreement covering tariffs, non-tariff barriers and other trade related issues such as services, investment, procurement, regulatory issues, competition, and sustainable development.”

It adds that the FTA with Thailand “should deliver substantial economic gains and put the EU on a par with partners who have already concluded FTAs with Thailand (China, India, Japan, Korea, Australia and New Zealand).” The first negotiating round is expected to take place possibly in May, before the summer break.

Like the NGOs, some members of the European Parliament (MEPs) are keeping a close eye on the negotiations and the aspects of the FTA that could have a harmful impact. Franziska Keller, German MEP from the Green alliance, told IPS that she shared the concerns of civil society organisations.

“I completely agree that the government of Thailand should not let itself get into TRIPS-plus talks,” she said. “I also think that the EU should absolutely not force TRIPS. Medicine is an important part of Thailand’s budget and if generic medicine cannot be used, cannot be produced, this is going to be much more expensive for the Thai government.”

Realising what is at stake, demonstrators in Thailand have recently tried to draw attention to how the FTA may affect the cost of medicine and agricultural products in the country. They say the government has not adequately consulted with civil society in the talks on the multi-billion-dollar bilateral trade.

“The IP provisions, the enforcement measures and the investment chapter are all areas where the stakes are really high,” said Tessel Mellema, policy advisor for Health Action International.

She told IPS that Thailand may feel pressured to give concessions because of the impending expiration of its general system of trade preferences with the EU, due to end in early 2014. But Mellema said NGOs want Thailand to have “political room” to negotiate without pressure from the EU.

Thailand is the EU’s third largest trading partner in the Association of Southeast Asian Nations (ASEAN), and the EU is also Thailand’s third biggest trading partner. According to the European commission, trade between the bloc and Thailand reached nearly 32 billion euros last year.

It says that the EU is one of the biggest investors in Thailand with investment stocks valued at more than 14 billion euros in 2011.

EU exports comprise mainly high-tech products including machinery and electrical appliances, pharmaceutical products, vehicles, precious metals and optical instruments, the Commission said, while imports from Thailand include machinery and electrical appliances, foodstuffs, vehicles, precious metals, pearls, and plastics and rubber.

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