Thailand’s emerging trade hawks cloud CPTPP membership plan

  • Thailand’s prospective entry into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) trade pact could be in jeopardy if a looming cabinet reshuffle removes the country’s economic czar and brings in an administration stacked with military-backed protectionists.
  • An internal revolt roiling the ruling Palang Pracharat Party (PPR) threatens to oust its leader, Uttama Savanayana, who supports economic liberalization, along with Deputy Prime Minister Somkid Jatusripitak, the man behind the country’s push to join the free trade bloc. This could put Thailand’s membership up in the air.
  • Delays in Thailand’s entry into the pact will have broad repercussions for companies that have counted on the country’s membership in mapping out their supply chains, including Japanese automakers.
  • Somkid, an academic, enjoys significant clout within the party. He is closely aligned with Uttama, who doubles as the finance minister. Sontirat Sontijirawong, who holds the powerful energy minister post and Palang’s secretary-general, is a Somkid ally.
  • The military figures who make up Palang’s mainstream felt sidelined. The rebelling faction is now backing a deputy prime minister, Gen. Prawit Wongsuwan, for the new party leader. If Prawit wins, Prayuth will likely be forced into reshuffling the cabinet. He has signalled that this could happen as early as Jul 20.
  • If Somkid and all of his allies are driven out of the cabinet under a reshuffling, that could stall the momentum for Thailand’s participation in the TPP. Prawit’s clique has not expressed its stance on the TPP, but appears unenthusiastic about it.
  • Commerce Minister Jurin Laksanawisit and Public Health Minister Anutin Charnvirakul have both expressed caution over Thailand’s entry. They belong to the coalition partner Democrat and Bhumjaithai parties, respectively.
  • “Military figures who want to drive out the Somkid faction have exerted pressure within parties,” a diplomatic source said.
  • Sensing the changes in political winds, Prayuth himself has modified his stance. He appointed Somkid precisely to ease concerns among foreign businesses, but at the end of May 20, the prime minister said Bangkok was still exploring whether to participate in the pact.
  • In the lower chamber of Thailand’s National Assembly, a committee to explore CPTPP membership said it will issue a decision at the end of Jun 20 after considering a wide spectrum of opinions. But if a cabinet reshuffle becomes likely, it is expected to put that announcement on hold.

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