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Cablegate: Peru Resumes Fta Negotiations with Thailand

This record is a partial extract of the original cable. The full text of the original cable is not available.





E.O. 12958: N/A

REF: 04 LIMA 5481

1. (U) Summary. After almost 10 months of delay, the GOP
resumed free trade talks with Thailand on August 15. During
round six, held in Lima August 15-17, the GOP and GOT will
negotiate chapters on market access, rules of origin,
customs procedures and safeguards. GOP officials view
Thailand as a strategic trade partner in Asia and expect
that an FTA with Thailand will open doors for future FTAs
with other countries in the region. End Summary.

FTA Talks Resume

2. (U) Trade talks between Thailand and Peru began in
January 2004 in Bangkok, with the fifth round held in Lima
last November. Although the GOP expected to complete the
free trade agreement (FTA) by December, talks were stalled
after the GOP instructed Ministry of Trade negotiators to
focus on FTA negotiations with the United States.
After a ten-month hiatus, the GOP, which states that U.S.-
Andean FTA negotiations have advanced significantly, has
turned its attention back to Thailand. FTA negotiations,
now on Round 6, will occur August 15-18 in Lima.

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3. (U) The 15 member Thai delegation, led by lead
negotiator Apiradi Tantraporn, will meet with GOP officials,
led by lead negotiator Pablo de la Flor, to negotiate
several FTA chapters, including market access, rules of
origin and customs procedures, and safeguards. The
governments will not/not discuss the services or investment

Why Thailand?

4. (SBU) The GOP continues to tweak its policy toward
Asia, and several GOP officials have informed us that they
believe the way into Asia - namely China - is through the
smaller countries, such as Thailand and Singapore. Thailand
is Peru's largest trading partner in Southeast Asia; Peru
exported over $30 million in goods to Thailand in 2004,
which accounted for 0.2 percent of Peru's total exports.
Principal products included zinc, copper, and fishmeal.
Peru imported $9.8 billion in goods in 2004, 0.4 percent of
which came from Thailand. Imports included light trucks,
manufactured goods such as ovens, microwaves, and
refrigerators, and polyester thread/fabric.

5. (SBU) The GOP believes that an FTA with Thailand will
benefit Peru's large agricultural sector. Vice Minister of
Trade Pablo de la Flor noted that exports of fruit (grapes),
asparagus, onions, paprika, and coffee should increase under
and FTA.


6. (SBU) The GOP expects that an FTA with Thailand will
enable Peru to improve its trade relationship with Asia,
perhaps culminating with additional FTAs with other
countries in the region. Completing this FTA may be more
difficult than the GOP realizes - negotiators must still
tackle the agriculture chapter. Rice will be a major issue,
as the GOP refuses to grant Thailand duty-free access for
rice. As we have seen with the U.S.-Andean FTA, Peru's
defensive position on sensitive agricultural products may be
the limiting factor for future FTAs.


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