WORLD TRADE  
ORGANIZATION   
WT/REG235/M/1 
7 July 2011  
 
(11-3349) 
Committee on Regional Trade Agreements 
Sixty-first Session  
 
 
 
ECONOMIC PARTNERSHIP AGREEMENT BETWEEN JAPAN AND THAILAND,  
GOODS AND SERVICES 
 
Note on the Meeting of 28 June 2011 
 
Chairman:  Mr. F. Riegert (France) 
 
 1. The 61st Session of the Committee on Regional Trad e Agreements (hereinafter 'CRTA' or the 
'Committee') was convened in Airgram WTO/ AIR/3754, and corrigendum 1 dated 17 May and 
21 June 2011.  
2. Under Agenda Item B.IV of this session, the CRTA considered the Economic Partnership 
Agreement between Japan and Th ailand (hereinafter 'the Ag reement'), goods and services.  
3. The Chairman noted that the Agreement had en tered into force on 1 November 2007.  It had 
been notified to the WTO by the Parties on 25 October 2007 under Article XXIV:7(a) of the 
GATT 1994 and the Understanding on the Interpre tation of Article XXIV of GATT 1994 as an 
Agreement establishing a free trade area (document WT/REG235/N/1) and under GATS Article V:7(a) as an Agreement providing for the liberalization of trade in services within the 
meaning of Article V of the GATS (document S/C/N/ 419).  The text of the Agreement was available, 
together with its Annexes, on the Parties' official  websites.  The Factual Presentation on the goods and 
services aspects (document WT/REG/235/1 dated 18 Apr il 2011) had been prepared by the Secretariat 
on its own responsibility in full consul tation with the Parties, in accorda nce with paragraph 7(b) of the 
Transparency Mechanism for Regi onal Trade Agreements (document WT/L/671).  In addition, 
written questions and replies on the Agreement ha d been distributed in document WT/REG235/2, 
dated 16 June 2011.  He proposed to organize the c onsideration of the Agreement by first asking the 
Parties and then other Members to give any gene ral comments.  The Committee would then turn to 
the specifics of the Agreement using the Factual Pre sentation to guide the debate and then go through 
the questions and replies document. 
4. The representative of Thailand thanked the Chai rman and the Secretariat for the Factual 
Presentation of the Economic Partnership Agreement between Japan and Thailand.  The Parties had 
established official trade relations in 1957 but b ilateral commerce had been taking place for over 400 
years.  Since then, the trade volume had increased tremendously, thus making Japan one of Thailand's 
top five trading partners and one of the biggest i nvestors in Thai business.  Against this background, 
the Parties had decided that they needed to estab lish a more substantive and meaningful economic 
cooperative framework to benefit more from each other's potentials and resources, facilitate trade 
flows and strengthen the bilatera l relationship through capacity bu ilding and cooperation in many 
important areas, such as science and technology,  research and development.  The Agreement was 
therefore the natural evolution of a long tradition of bilateral trade relations.  Initiated in 2002 by the 
Prime Ministers of the Parties, the first round of tr ade negotiations was held in February 2004 and the 
Agreement took a little over two years to be concl uded in June 2006.  Agreement was reached in 
21 topics such as trade liberalization in goods and services including investment and the movement of WT/REG235/M/1 
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  natural persons, rules of origin, safeguard mechan isms, customs valuation, competition policy, and 
intellectual property rights.  The Parties believed th at the Agreement had fulfilled its commitment to 
Article XXIV of GATT and Article V of GATS with the elimination of substantially all the trade 
barriers in goods and substantial sectoral coverage in services.  
5. The Agreement was signed in Apri l 2007, and was Thailand's first bilateral agreement with an 
Asian country to include trade in services.  Up to  68% of Thai exports to Japan had benefited from 
trade liberalization under the Agreement since its en try into force in November 2007.  Between 2007 
and 2010, the total trade volume between Tha iland and Japan was US$50-60 billion and had 
expanded  by 10% to 43% annually.  Major Thai exports, such as shrimp products, fresh tropical 
fruits, processed vegetables, enjoyed duty free trade since the Agreement's entr y into force.  Other 
goods also benefitted from lower tariff rates, for ex ample, rubber, automobile and parts, computers 
and parts and processed chicken.  An increase in  exports and trade under the Agreement would create 
more employment and help Thailand utilize its local resources more efficiently.  
6. With closer ties between the two countries,  Thailand firmly believed that commercial 
relations and other aspects of cooperation between th e Parties would further strengthen existing trade 
and investment.  This could also contribute to th e increased volume and value of trade and investment 
within the Asia-Pacific region and eventually to globa l trade as a whole.  He noted that Thailand had 
continuously supported the multilatera l trading system and believed that through a collective effort in 
trade liberalization and facilitation, protectionism and barriers to trade could be abated and eliminated.  
Thailand also viewed regional trade agreements as one  of the means to help achieve the final goals of 
the multilateral trading system and to strengthen th e importance of the WTO.  He thanked Australia, 
Canada, Chinese Taipei and the United States for their advance written questions for which written 
responses had been provided.  Finally, although Thailand had no technical experts present at the 
meeting due to resource constraints, he would be  happy to pass along any further written questions 
from the Members to capital-based expe rts to respond to in due course. 
7. The representative of Japan thanked the Co mmittee for the opportunity to present the 
important elements of the Agreement between Japa n and Thailand for an Economic Partnership for 
review by WTO Members.  Japan’s basic extern al economic policy had been to maintain and 
strengthen the multilateral trading system centeri ng on the WTO and promoting the conclusion of 
bilateral EPAs/FTAs that would complement but not replace the WTO.  As part of this policy, Japan had concluded the Agreement with  Thailand, which had entered in to force in 2009.  It was the 
fifth agreement concluded by Japan, following tho se with Singapore, Mexico, Malaysia and Chile.   
8. The key objectives of the Agreement were the liberalization and facilitation of trade and 
investment, as well as cooperation for capacity-bui lding.  Through these means, it was expected to 
further strengthen economic relations  between the Parties.  Thailand was one of Japan’s major trading 
partners and investment destinations.  It was th e 6th largest importer of Japanese goods and services 
and 10th largest exporter to Japan.  Both countries ha d decided to negotiate the Agreement to further 
strengthen these economic ties.  In addition, as for Japan, it was expected that the conclusion of the 
Agreement with Thailand, which was one of the core countries of ASEAN, would create a positive 
and demonstrative impact on other ec onomies, particularly in East As ia, and help further develop and 
enhance the comprehensive economic partnership within the region as a whole.  
9. In December 2003, the Prime Ministers of Japa n and Thailand decided to start negotiations 
with a first round in February 2004.  In Sept ember 2005, about one and a half years after the 
negotiations started, the leaders of both countries confirmed successful comp letion on major elements, 
to be followed by the finalization of the legal te xts of the Agreement.  The Agreement was signed by 
the two leaders on 3 April 2007 in Tokyo, and entered into force on November 1st, 2007.  It was a comprehensive economic partnershi p agreement, and included tari ff elimination as its central 
component.  Within ten years, it would eliminate up to 95% of tariffs in terms of two-way trade  WT/REG235/M/1 
 Page 3 
 
 
  volume and with regard to the liberalization of tr ade in goods, all major sectors were covered.  
Furthermore, the parties did not have any other restrictive regulations of commerce that were 
incompatible with GATT 1994, and the Agreement ne ither established any restrictions on commerce 
nor maintained existing ones. Thus, the Agreement met the GATT 1994 requirement that other restrictive regulations of commerce should be elimin ated on substantially all the trade which made it 
compatible with GATT Article XXIV.  Moreover, the Agreement provided national treatment for a 
broad range of sectors/sub-sectors concerning trade in services, and was therefore compatible with GATS Article V.  
10. The Agreement would increase the cross-border flows of goods, investment and services and 
would also facilitate the movement  of natural persons, thereby stre ngthening the economic partnership 
between the Parties and promoting their economic de velopment.  It provided for the facilitation of 
mutual recognition, the protection of intellectual pr operty, the promotion of fair and free competition, 
as well as cooperation in (i) agriculture, forestry and fisheries, (ii) education and human resource development, (iii) the enhancement of the bu siness environment, (iv) financial services, 
(v) information and communication technology, (vi) science and technology, energy and environment, 
(vii) small and medium enterprises, (viii) tourism, a nd (ix) trade and investment promotion.  In this 
regard, nine Sub-Committees had been established under the Chapter on Cooperation with a view 
to reaching a mutually beneficial agreemen t. Furthermore, the Joint Committee and 
ten Sub-Committees had been established to ensure e ffective implementation and operation in trade in 
goods, rules of origin, customs procedures, paperless trading, mutual recognition, trade in services, 
investment, movement of natural persons, intellectual property and government procurement.  Since 
the entry into force of the Agre ement, the Sub-Committees on trade in services, tourism, rules of 
origin, agriculture, forest and fisheries, trade in services, movement of na tural persons, enhancement 
of the business environment and trade in goods had met so far for effective implementation and 
operation in each field.  In this way the framewor k of the Agreement had been proactively utilized.   
11. It was difficult to measure the economic effects of the Agreement as the volume of trade and 
investment between the Parties could be affected by various factors, such as economic fluctuations 
resulting from global economic crises and natural di sasters.  In any case, Japan believed that the 
Agreement provided a solid foundation and instituti onal infrastructure to increase bilateral trade and 
investment by strengthening the economic partnership through the means provided in the Agreement.  
He thanked the CRTA for the opportunity to submit  a report on the Agreement.  The Parties were 
convinced that it had laid a solid foundation for furt her growth in bilateral trade and investment as 
well as a strengthening of bilateral economic ties.  
12. The Chairman opened the floor to general comments from Members. 
13. The representative of the European Union noted that the Agreement was not really balanced 
in terms of sectoral coverage and that replies to written questions had also not been satisfactory in 
providing further information and clarification.  He stressed that the CRTA should receive more 
detailed information on the reasons fo r not having substantia lly liberalized all sectors.  The EU also 
encouraged the Parties, notably Japan, to make furt her commitments in areas not yet liberalized and to 
take advantage of the general review clause for trade in goods to review and improve concessions. 
14. The representative of Japan confirmed that under the review clause the Parties were 
committed to further negotiations in agricu ltural items in the very near future. 
15. The representative of the United States thanke d the Parties and the Secretariat for the 
information provided and the Factual Presentation.   He noted that according to the Factual 
Presentation Thailand eliminated tariffs on 97.3% of all tariff lines covering 84% of imports by value 
from Japan;  98% and 92%, respectively, of industria l and agricultural tariff lines became duty free.  
Meanwhile Japan eliminated duties on 90% of all ta riff lines covering 92% of imports from Thailand.  WT/REG235/M/1 
Page 4  
 
  However, although 96.5% of industrial tariff lines we re duty free only 64% of agricultural tariffs were 
eliminated.  The United States was again forced to note Japan's disproportionate liberalization 
between its industrial and agricultural sectors.  Also  of note was that according to paragraphs 20 and 
21 the implementation period for tariff elimination w as five years longer for Japan than for Thailand, 
2022 for Japan and 2017 for Thailand and he asked why Japan needed more time, particularly since it 
was liberalizing less overall than Thailand.  In Question 13 in document WT/REG235/2, the United 
States had asked why Japan liberalized a lower percen tage of agricultural tariffs than Thailand.  The 
response stated that the figures re presented the results of negotiati ons conducted by both Parties, 
taking into consideration each side's specific interest  and concerns.  He asked Japan to elaborate on its 
specific interests and concerns in this context. 
16. The representative of the European Union no ted that the Agreement did not contain 
provisions for the elimination of export duties a nd asked if the Parties could explain why such 
provisions had not been included.  He also asked them to elaborate on any current or future export 
duties on trade between the Parties and how they in tended to ensure compliance with the obligations 
in GATT Article XXIV to eliminate duties and restrictive regulations of commerce on substantially 
all the trade.  In this regard the EU underlined the obligation un der Article XXIV to cover export 
duties in liberalization commitments. 
17. The representative of Japan said that some of Japan's agricultural products were quite 
sensitive and in the negotiations it was agreed that  a 15-year period be granted to those products.  
However, as shown in the Factual Presentation, such products represented 115 tariff lines which did 
not account for a large amount of Japan's imports from Thailand.  Due to the sensitivity of these 
products a 15-year transition period for liberaliza tion had been necessary and Japan had negotiated 
hard for this.  On the question from the United St ates on Japan's specific interests or sensitivities it 
was well known that Thailand was a major agricultu ral producer with many competitive agricultural 
products.  So naturally Japan had negotiated hard to  determine what could be liberalized immediately 
and what would require a longer transition period of 15 years.  Japan had quite a few products of 
export interest to Thailand and it had not been possi ble to complete all the negotiations in time.  For 
this reason some renegotiations were due to take  place in the following year.  Japan had also not 
negotiated with regard to products th at were not of export interest to  Thailand like wheat, sugar, sugar 
beet, potatoes which were grown in colder areas.  Th is was the meaning of specific interests.  He was 
happy to respond to any further specific questions, e ither in the CRTA or bilaterally.  He explained 
that there were no export duties applied at present a nd no intentions to introduc e any, and although he 
took note of the point by the EU, this had not been a major issue in the negotiations. 
18. The representative of Thailand echoed the response on export duties by Japan and indicated 
that he would also convey the EU's question to capital. 
19. The representative of the United States th anked the Parties for their responses. 
20. The Chairman said that the consideration of the Goods and Services Aspects of the 
Economic Partnership Agreement be tween Japan and Thailand had allo wed the Committee to clarify a 
number of questions and oral discussion of this  RTA could be concluded in accordance with 
paragraph 11 of the Transparency Mechanism.  If any delegations wished to ask follow-up questions 
they were invited to forward submissions in writing to the Secretariat by 6 July 2011 and the Parties 
were asked to submit replies in writing by no later than 20 July 2011.  In accordance with paragraph 
13 of the Transparency Mechanism all written s ubmissions as well as minutes of the meeting would 
be circulated promptly in all WTO official languages and would be made available on the 
WTO website. 
21. Members took note of the comments. 
__________