Wednesday, November 12, 2008

US envoy warns of trade barriers for Thailand


The US ambassador to Thailand has warned that local manufacturers using illegal labour and those unable to promote labour standards could face trade difficulties in the US market.

Eric John and the US Embassy's counsellor for commercial affairs raised the issue in talks with Industry Minister Pracha Promnok yesterday, according to ministry spokesman Sorayut Phettakul.

The ambassador pointed out that employment of illegal labour and inability to uphold labour conditions would result in discrimination against Thai products in the US market, according to Mr Sorayut.

Businesses in Thailand would thus face a similar situation as some of their peers in China and Vietnam, Mr John was reported to have said.

However, the warning by the envoy was not news to local manufacturers, since labour issues are frequently used as trade barriers by the US and European countries to protect their local industrial sectors, according to Santi Vilassakdanont, the chairman of the Federation of Thai Industries (FTI).

"Local producers serving the US and European markets are well aware of the need to adhere to international standards of labour treatment, human rights and environmental impact control in the manufacturing process," Mr Santi said.

"This issue is well known as (US) Democrat party policy and local suppliers to the US market know it well. It is good to hear what our trade partner thinks and it is not a concern as local producers have been able to handle this labour issue very well so far."

While it was not possible to fully control the employment of illegal labour, Mr Santi said, Thailand had a better record on employment practices and labour rights than others in the region.

Deteriorating investor sentiment around the globe because of fear of a recession is also a concern for the US ambassador.

Mr John expressed concern that global investment would slow down and suggested that bilateral co-operation would be needed to improve trade sentiment.

"He has suggested that we do a trade roadshow together to improve sentiment, bilateral investment and trading," Mr Sorayut said.

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