On October 19, 2003, negotiation between Thai and Australian Government had finally completed, giving birth to Thailand-Australia Free Trade Agreement (TAFTA), the first comprehensive free trade agreement between Thailand and a developed country and the third free trade agreement for Australia. Since entering into force during January 2005, TAFTA has greatly affected on investment flows between Thailand and Australia. Like most Free Trade agreements, the main objective of TAFTA are to facilitate trades, open up business opportunities to bring about mutual Benefits for the two partners.
To begin with, the reductions and eliminations of trade barriers such as certain tariff rates is one of the results from TAFTA. Before, Thailand's average tariff rate was around 15% which had considered to be much higher comparing to Australia’s which was only 3.9%, However, after TAFTA has come into force, tariffs on 80% of products exported from Australia to Thailand have started to be reduced or eliminated by this 2010.
Moreover, both countries also have been expected to enjoy the ease of foreign investment restrictions and protections of investment through guarantees against expropriation as well as nationalization. As a result, Australia firms can gain opportunities to invest in other service sectors such as telecommunications, airline, catering, and hotel sectors apart from those sectors that are very important to Australia such as mining industry since foreign equity restrictions were lift off to help investors. Moreover, under TAFTA, both countries have cooperated to take strong measures to prevent the export of goods which infringe copyrights or trademarks as well.
Apart from trading benefits, better social welfares are also other benefits of TAFTA. Australia has canceled Labor Market Test for Thai citizen which has fastened process for Thai citizens when applying to work in Australia. In addition, the establishment of Working Holiday scheme has allowed Thai...
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