European Chamber urging political de-escalation ahead of next FTA talks

Thailand should ease political instability as quickly as possible, as the next round of Free Trade Agreement (FTA) negotiations is set to begin in Bangkok next week, according to Paranee Adulyapichet, President of the European Association for Business and Commerce (EABC).

She noted that negotiations were previously suspended due to Thailand’s lack of political stability, adding that it remains uncertain what the outcome of the upcoming talks will be if instability continues.

"From a business perspective, we’ve seen the FTA put on hold before due to political instability. That’s why we strongly encourage a rapid de-escalation. Otherwise, the situation will remain unpredictable and it’s unclear how that uncertainty could affect the outcome of the negotiations,” the President opined.

FTA negotiations between Thailand and the European Union were suspended in 2014, following a coup led by General Prayut Chan-o-cha.

Amid intensifying regional competition, neighbouring countries, such as Malaysia, are also pursuing an FTA with the EU. Paranee advised that the Thai government must prioritise the negotiations to ensure long-term economic benefits.

With Thailand’s economy growing sluggishly, as emphasised by the World Bank’s recent downgrade of its 2025 GDP growth forecast to just 1.8%, she stressed that finalising the FTA could significantly boost the market.

“We see benefits not just in terms of tariff reductions, which would enhance trade and promote diversification, which is especially important given the current geopolitical shift. The EU and Thailand could collaborate more deeply and increase investment through innovation and talent development,” she added.

Paranee emphasised the importance of European investment in Thailand, which totals approximately 1.5 trillion baht and has created over 160,000 jobs. She noted that European investors continue to see Thailand as a long-term investment destination.

While political instability is not new in Thailand, Paranee concluded by underlining the importance of long-term policy direction and development strategies that support a stable business environment.

By Franc Han Shih, Thai PBS World