Government to speed up free trade pact negotiations with the UK

A free trade pact between the United Kingdom and the Kingdom of Thailand is on track after the Deputy Prime Minister for Thailand met with Britain’s Minister for Asia and the Pacific and both agreed to speeding up trade talks in a bid to boost trade and investment between the two countries. The two countries agreed in principle last year to work on a free trade agreement and in the most recent meeting the Deputy Prime Minister also proposed strategic partnerships in specific industries such as high tech, aviation, automobiles and aerospace. A trade delegation is expected to visit the United Kingdom in the next few months to begin discussions. The United Kingdom is Thailand’s 19th largest trading partner and the second largest in Europe. Exports last year were valued at 206.7 billion baht and key exports include gems and jewelry, seafood, garments, processed chicken, cars, electrical circuits, motorcycles, machinery, and air conditioners.

The TOT will be taking over the fixed line provincial services from TT&T on March 1, 2017 after the Bankruptcy Court ordered the confiscation of their home infrastructure assets last year. TOT was ordered to take over two jobs; repairing or replacing transmission equipment and maintenance of TT&T’s transmission system so that customers do not lose service after the concession expires. TT&T announced it has no plans on dissolving its fixed line business unit. TOT currently has more than 1.4 million provincial fixed line subscribers and will be taking over the remaining 300,000 subscribers that TT&T had. TOT said there will be no disruption in service for TT&T users with the changeover.

The government is looking into the new surcharge being added to airline tickets added by airlines after the government raised its fuel taxes. Four airlines are adding a 150 baht surcharge to cover the costs of the 1900 percent rise on fuel taxes instituted by the government; those airlines include Thai AirAsia, Thai Lion Air, Nok Air and Thai VietJet. Bangkok Airways will add the surcharge later while Thai Air and Thai Smile are reviewing the situation. The surcharge will affect all domestic routes. The airlines insist the rise reflects the actual cost increase where the excise tax rose from 20 satang per liter to 4 baht on January 25, 2017. However, the government feels the surcharge is not in line with the rise, stating the surcharge should only come to 50 baht per seat per hour and not 150 baht. The government said the tax rise was in line with other excise taxes on fuel, noting motorists pay 4 – 5 baht per liter while airlines have been paying only 20 satang a liter for the past 24 years. The airlines state the tax rise will make it difficult for them to offer low cost flights.

The Department of Airports will be investing 24 billion baht in four airports around the country in a bid to increase capacity. Krabi, Khon Kaen, Nakhon Si Thammarat and Trang will see added terminals to cope with the increasing number of passengers. Most airports are already operating beyond capacity; Krabi has the capacity to handle four million passengers a year and that number is expected to double in the next few years, Nakhon Si Thammarat is handling 1.4 million a year, over the 1.1 million capacity of the airport. A 2 billion baht budget was already approved to build the Betong Airport in Yala and is expected to open by 2021. The government also plans to develop the Mae Sot airport in Tak.

Work Permit

Any foreigner working in Thailand must obtain a Work Permit before beginning work. While a prospective employer may file an application on the foreigner’s behalf in advance of his starting work, the actual Work Permit will not be issued until the foreigner has entered Thailand in accordance with the immigration laws and has presented himself to receive his Work Permit.

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