Singapore And Thailand Work Towards Closer Economic Harmony

by Mary Swire, Tax-News.com, Hong Kong

28 August 2003

Singapore and Thailand have agreed to forge closer trading links following a round of trade talks between the two South East Asian economies this week.

According to the Singaporean Minister for Trade, the agreement represents the "first step" on the path to the "one economy, two nations" vision formulated by Singapore Prime Minister Goh Chok Tong and Thai prime Minister Thaksin Shinawatra during a summit in February last year.

The two nations do a significant amount of business with each other and bilateral trade between them amounted to US$11.4 billion last year, a 6.2% increase on the previous year. Accordingly, Singapore is Thailand's fourth largest trading partner, whilst Thailand is Singapore's seventh largest.

The recent discussions have also raised the possibility of allowing hi-tech goods manufactured in Thailand free access to the US market through the Singapore/US trade agreement signed earlier this year.

Mr Yeo indicated that the general aims of the economic agreement would be to facilitate an increased flow of trade, investment and labour between the two countries, though stressing that a fully fledged Free Trade Agreement is unnecessary as the multilateral ASEAN agreement already makes provision for this.

Meanwhile, it has emerged this week that Singapore Exchange Lts (SGX) has signed a two-way agreement with the Stock Exchange of Thailand designed to develop the securities market of each bourse. This is likely to take the form of joint promotion and marketing as well as information sharing regarding the regulatory environment.

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