This is a highly contentious issue, as the government led by General Prayuth Chan-o-cha is preparing to sign a trade agreement or join the CPTPP. Scholars from various sectors and politicians from both the opposition and the ruling party have expressed their opposition to this membership. Recently, Deputy Prime Minister Jurin Laksanawisit and the Minister of Commerce announced an urgent order to withdraw the CPTPP agenda from the Cabinet meeting scheduled for Tuesday, June 28, 2020. 

Understanding CPTPP 

CPTPP (Comprehensive and Progressive Trans-Pacific Partnership) is a comprehensive and progressive agreement for economic partnership in the Pacific region. It is a free trade agreement that covers trade, services, and investment to create common standards and regulations among member countries, including issues related to intellectual property protection, labor standards, environmental laws, and mechanisms for resolving disputes between governments and foreign investors. 

The agreement began in 2006 under the name TPP (Trans-Pacific Partnership) with 12 member countries. In 2017, the United States withdrew, leaving 11 member countries: Japan, Canada, Mexico, Peru, Chile, Australia, New Zealand, Singapore, Malaysia, Brunei, and Vietnam. The name was changed to CPTPP. Although moving forward without the United States has reduced the economic size and trade of the agreement, it has also led to more relaxed regulations due to the absence of the negotiating power of the large U.S. economy. 

What will Thailand gain from joining CPTPP?

The SCB Economic Research Center (SCB EIC) summarizes three key points as follows: 

Exports 

CPTPP will increase Thailand's export opportunities to member countries, especially Canada and Mexico, where Thailand currently has no free trade agreements. In 2017, Thailand's exports to CPTPP countries accounted for 30% of total exports, with a growth rate of 9% compared to the previous year. For Canada and Mexico, the combined export share was only 2%. Major exports to Canada include processed seafood, rice, and rubber products, while major exports to Mexico include cars and electronic components. These products have good prospects if Thailand successfully joins CPTPP. 

Foreign Investment 

Joining CPTPP will help attract investments that want to use Thailand as a manufacturing base for exports to CPTPP member countries. If Thailand does not join, we may lose this opportunity to Malaysia and Vietnam. 

Competitiveness 

CPTPP will enhance Thailand's competitiveness by improving domestic regulations to align with CPTPP standards, which are known for being high-quality trade agreements. Examples of regulations supported by CPTPP include labor rights laws, environmental conservation, and fair competition between local and foreign businesses. These legal reforms will have long-term positive effects for Thailand. 

Moreover, because CPTPP has more relaxed regulations compared to TPP, Thailand will also benefit in this regard. For instance, in the pharmaceutical industry, TPP previously mandated that member countries accept increased drug monopolies, making access to generic drugs difficult for the government and the general public, thus raising healthcare costs. However, this agreement was ultimately suspended, so Thailand will not lose this benefit if it chooses to join CPTPP. 

Potential Losses from Joining CPTPP 

Service Sector 

For the service sector, CPTPP employs a negative list negotiation approach, meaning member countries can specify which service sectors they do not wish to liberalize. Consequently, other service sectors not specified in the agreement must be fully opened to foreign investors. Therefore, for Thailand, which has a relatively closed service sector, this liberalization may disadvantage domestic service businesses to foreign investors. 

Agricultural Industry 

Thailand will face increased competition, especially from agricultural products from Canada, such as fertilizers and soybeans, which will enter the Thai market after trade liberalization. Additionally, CPTPP requires member countries to adhere to the UPOV (International Union for the Protection of New Varieties of Plants) convention, allowing foreigners to take Thai native plant varieties for research to create new plant varieties and patent them. This directly harms Thai farmers because if they plant these new varieties, they cannot save seeds for future planting as before; they must buy new seeds, increasing agricultural costs. 

So, is it more gain or loss? 

If we calculate Thailand's economic size based on GDP, in 2019, the National Economic and Social Development Council reported that Thailand's economic growth was approximately 17 trillion baht, with exports valued at over 7.5 trillion baht, mostly related to agricultural products. Meanwhile, tourism was valued at over 2 trillion baht, with the service sector being a part of tourism. 

Regarding opinions from scholars and politicians from various sectors, there has been a predominant expression of opposition as follows: 

Government Divided: Agriculture and Health Sectors Disagree 

Ms. Mananya Thaiseth, Deputy Minister of Agriculture and Cooperatives, expressed concern that if Thailand joins the UPOV 1991, it would lead to monopolies in patenting new seed varieties, preventing farmers from saving seeds for future planting, especially rice seeds developed by ancestors through natural methods. Thai rice varieties are the most popular in the world. 

There are fears that if the government signs the CPTPP, it will cause nationwide distress. There is a need to understand why this agenda is being presented to the Cabinet now, given previous unsuccessful attempts. Therefore, careful consideration is necessary, and relevant agencies must clarify why it did not pass in the past, particularly regarding impacts or benefits to farmers. As the Deputy Minister of Agriculture overseeing the Department of Agriculture, I have consistently emphasized the registration of protection for Thai seeds to safeguard farmers' interests.

Mr. Anutin Charnvirakul, Deputy Prime Minister and Minister of Public Health, held a meeting with ministry executives and the director of the Government Pharmaceutical Organization to assess the impacts of Thailand joining the CPTPP. Various issues affecting the domestic pharmaceutical industry and plant variety protection were discussed.

After the meeting, Mr. Anutin instructed ministry executives to prepare a report detailing the impacts if Thailand decides to join CPTPP, clearly stating that the Ministry of Public Health does not support Thailand's membership in CPTPP.

“As the Minister of Public Health, I do not agree with this matter and will present the Ministry of Public Health's concerns and worries about the impacts on the production of medicines, medical supplies, and equipment necessary for the care and health of Thai people to the Cabinet meeting on April 28. However, I cannot predict how the Cabinet will decide, but the concerns of the Ministry of Public Health regarding the impacts on drug production, which is crucial for Thailand's health security, should be important information for the Cabinet's consideration.”

Opposition: CPTPP is Not Worth It for Thailand 

Mr. Pita Limjaroenrat, leader of the Move Forward Party, posted on Facebook expressing the party's stance that the Cabinet is about to discuss approving Thailand's membership in CPTPP, which will have various impacts. Overall, it is clear that the benefits do not outweigh the costs, and this matter is not urgent. The government should listen more to the voices of the people and take time for careful consideration.

Firstly, the United States has already withdrawn. If Thailand joins CPTPP, the markets it will gain access to are only Mexico and Canada. Meanwhile, for the other nine remaining member countries, Thailand already has free trade agreements (FTAs) with all of them. I would like to consider why Thailand needs to join in this manner. It may be better to negotiate bilateral agreements with Mexico and Canada to avoid unnecessary complications.

Somkid Jatusripitak, Deputy Prime Minister and chairman of the International Economic Policy Committee, explained that if Thailand joins CPTPP, GDP is expected to increase by 0.12%, which is a minimal amount compared to previous memberships. I believe this time it will not be worth it. There are many ways to boost GDP, and we should not have to sacrifice Thailand's economic sovereignty to this extent.

Moreover, upon reviewing the details, there are concerns about seed monopolies, biodiversity, farmers' costs, food security, and drug security, as well as the possibility of foreign investors suing the Thai government through arbitration processes and many other issues.

Under the 2017 Constitution, there is no requirement for the government to seek parliamentary approval for negotiating international agreements, leading to a lack of legislative oversight and public participation. There is only a mechanism for the parliament to approve after negotiations are completed for signing and awaiting ratification. This means that such a significant issue could be easily approved, highlighting one of the concrete problems with this constitution.

 

My party and I emphasize that the government should listen more to the voices of the public and allow the parliament to debate the details. In such chaotic situations, the government should not take advantage to “support big capital and suppress small capital.”

 

Scholars Compare CPTPP to a Candy Filled with Cyanide 

Associate Professor Dr. Somchai Rattanachai, Dean of the Pridi Banomyong Law School, expressed his opinion on the matter, stating that if we examine the content of the CPTPP provisions, we will find many places clearly stating that the commitments in CPTPP do not affect the obligations of parties already existing under other laws, and CPTPP can coexist with other agreements to which the parties are members.

Let's look at an example: 

Section A Initial Provisions

Article 1.2 Relation to Other Agreements states:

1. Recognizing the Parties’ intention for this Agreement to coexist with their existing international agreements, each Party affirms:

(a) in relation to existing international agreements to which all Parties are party, including the WTO Agreement, its existing rights and obligations with respect to the other Parties; and 

(b) in relation to existing international agreements to which that Party and at least one other Party are party, its existing rights and obligations with respect to that other Parties, as the case may be.

It can be seen that this is a beautiful principle: to acknowledge that the rights and obligations under existing international agreements still apply, and CPTPP will simply add another agreement. But is it really true?

Because the previous international agreements will not conflict with what is written in CPTPP at all?

“If there is no conflict at all, then why go through the trouble of making CPTPP as an additional agreement?”

This implies that there must be something different, which could happen in two ways:

Firstly, the original agreement never specified or enforced this issue, or it may have been specified but was unclear or ineffective.

Secondly, the original agreement was too strict, and they want to lighten it.

But what if the existing agreements contradict what is newly written in CPTPP? No need to worry, CPTPP has paved the way for that. It states:

Article 1.2 (2) If a Party considers that a provision of this Agreement is inconsistent with a provision of another agreement to which it and at least one other Party are party, on request, the relevant Parties to the other agreement shall consult with a view to reaching a mutually satisfactory solution. This paragraph is without prejudice to a Party’s rights and obligations under Chapter 28 (Dispute Settlement).

This means that if one party believes that a provision of the international agreement it is a party to conflicts with what is written in CPTPP, that party has the right to request negotiations to find a mutually satisfactory solution.

It seems fitting for a noble lineage to seek a solution together when there is disagreement.

But in the real world of international economics, reaching agreement is quite difficult. In the WTO, there are numerous lawsuits, and Thailand has faced many challenges, the latest being the plain packaging measures for cigarettes.

And if there is disagreement and no mutually agreeable solution can be found, what then? This is where I see CPTPP hiding the cyanide.

In the last sentence of Article 1.2(2), which is the secret weapon.

“... This paragraph is without prejudice to a Party’s rights and obligations under Chapter 28 (Dispute Settlement).”

This indicates that if an agreement cannot be reached, the parties must resort to the dispute resolution process as specified in Chapter 28. I will expand on the dispute resolution methods in CPTPP when I have time. From what I have skimmed, the process is similar to arbitration.

Thus, it can be seen that while it is stated from the outset in Article 1 that we coexist (meaning CPTPP coexists with other agreements), in reality, if there is a conflict, the parties will be dragged into the dispute resolution process.

Consider the implications of dispute resolution; it is still uncertain what the outcome will be, but the rights and obligations we previously had, which we could easily fulfill under the original agreements, may now be in a precarious position, and those rights could vanish with the winds of CPTPP.

So how can we call this coexistence? It seems more like “coming to live above you” instead of coexistence.

Think about it: which civil servant would dare to risk dragging Thailand into the CPTPP dispute resolution process?

Perhaps even the officials in positions at that time might be apprehensive, fearing they could lose their reputation and miss out on the next parliamentary position. Such situations could arise.

The thought-provoking question is: why would we want to join CPTPP to seek a higher heaven?

Are we sure that CPTPP is heaven? Are we sure that CPTPP is not the seventh circle of hell instead of the seventh heaven?!!!

To be specific, if it is the seventh heaven for someone, who is that someone?

If CPTPP is indeed the seventh circle of hell, the ones who will suffer the most, and whom I clearly see will definitely win the lottery, are the Thai farmers. This is due to CPTPP's requirement to join UPOV 1991, which I will find time to analyze further.

This leads me to think that the way international agreements are written can result from negotiation processes in drafting, where some things we do not want may be written in a way that appears upfront but is taken away behind the scenes. This is quite ironic and hidden.

CPTPP is thus like a beautifully colored candy that is enticing, but after a while, the cyanide hidden inside will dissolve and seep out, eating away at our insides.

By then, those who pushed for Thailand to become a slave to CPTPP will likely look up and walk away, acting low-profile, just like how Thailand has become a dumping ground for electronic waste due to the irresponsible implementation of JTEPPA (Japan-Thailand Economic Partnership Agreement) (that person probably thinks, “My job is done; what happens to your life is your problem; I have no obligation to help...”).

Thank you for the information from SCB EIC, FTA Watch, www.techsauce.co