Thailand-Australia Free Trade Agreement

Thailand market snapshot

  • GDP: US$345.7 billion (2011)
  • GDP per capita: US$5,395 (2011)
  • GDP growth: 6.4 per cent (2012)
  • Population: approximately 69 million (2012)
  • Trade with Australia: AU$17.7 billion (2011-12)

About TAFTA

The Thailand-Australia Free Trade Agreement (TAFTA) has eliminated the majority of Thai tariffs on goods imported from Australia. The reduction of Thailand's previously high tariff barriers (for some goods, up to 200 per cent) is a significant win for Australian businesses, opening up a range of export opportunities in Southeast Asia's second-largest economy. TAFTA also improves the environment for bilateral services trade and investment.

The agreement entered into force on 1 January 2005 and was Australia’s third free trade agreement. It was Thailand’s first comprehensive free trade agreement and its first with a developed country. Total two-way trade between Australia and Thailand has more than doubled since TAFTA entered into force.

Key interests and benefits

  • The elimination of 94 per cent of Thailand’s tariff and quota barriers on imports from Australia as of 2010, with the remaining tariffs phasing to zero in 2015 or 2020 (with the exception of skim milk powder and liquid milk and cream, for which the tariff rate quotas will be eliminated in 2025).
  • More open access for Australian companies to Thailand’s services market and a commitment to liberalise two-way services trade in future.
  • Increased access for Australian investors in Thailand, permitting majority Australian ownership for businesses in certain sectors including mining operations, construction services, restaurants and hotels, tertiary education institutions, maritime cargo services and more.
  • Provisions on investment protection that guarantee a range of rights to Australian direct investors in Thailand, including the right to transfer their funds out of Thailand at any time, and the right to seek impartial resolution of any disputes with the Thai government over their investments.
  • Facilitates business by easing visa and other requirements for the temporary entry of Australian business people to Thailand, including through reduced paperwork, access to a one-stop visa and work permit service, and extension of the maximum length of stay under business visa arrangements.

Key outcomes of the Thailand-Australia Free Trade Agreement

Thailand's tariff commitments [ZIP (compressed) 517 KB]

Map of Thailand - quick facts

Map of Thailand

Industrial Estates

Thailand has created a network of Industrial Estates, with projects in each zone receiving incentives, tax and duty reductions and allowances for infrastructure investments.

News

Improving TAFTA

Thailand hosted the third TAFTA Joint Commission meeting on 21 June 2012 in Bangkok. The Joint Commission meeting resulted in progress towards the two reviews mandated under TAFTA – a general review and a review of its provisions on special agricultural safeguards – and improved implementation procedures.

The Joint Commission meeting agreed to restructure the subsidiary bodies of the Joint Commission by replacing the Working Group on Market Access with a Market Access Implementing Committee to address market access issues and take forward the two TAFTA reviews.

At the meeting, Thailand agreed to provide earlier notification of adjusted trigger volumes for products that have exceeded the trigger volumes in the previous calendar year. This will provide greater certainty for Australian exporters seeking to determine whether a shipment would enjoy the preferential TAFTA tariff rate, or whether the trigger volume had already been met and its shipment would be subject to Thailand’s MFN rate.

It was further agreed that Thailand and Australia would move towards the use of electronic signatures and seals for TAFTA certificates of origin. Officials are working to bring this change into effect in 2013.

TAFTA and Changes to the Tariff Classification System (HS2012)

In 2012, changes were be made to Australia’s tariff structure to reflect the latest five yearly amendments to an International Convention for classifying goods for trade purposes — known as HS2012.

The HS2012 changes impact on tariff classifications, Australian Harmonised Export Commodity Classifications (AHECC) and Rules of Origin.

HS2012 changes will not affect the tariff rates under the TAFTA.

Advice for importers and exporters arising from HS2012 can be obtained from the Australian Customs and Border Protection Service [DOC]

Official documents

Here you can locate the full text of the Thailand-Australia Free Trade Agreement and other associated official documents.

For business

A practical guide for Australian exporters on how to benefit from the provisions of TAFTA is available on our website.

Certificates of Origin

Reduced or zero tariffs are only available for goods that originate from Australia or Thailand. If products satisfy the relevant 'rule(s) of origin', businesses should obtain a Certificate of Origin to ensure that products receive the TAFTA preferential tariff rates. The Australian Industry Group (AI Group) and the Australian Chamber of Commerce and Industry (ACCI) and affiliated bodies are authorised to certify origin for TAFTA ('Authorised Bodies'). Certificates of Origin can be obtained from either AI Group or from your State or Territory Chamber of Commerce and Industry.

Doing business in Thailand

The Australian Trade Commission’s (Austrade) TAFTA website has further information about the agreement.

Resources

More about Thailand

Contact us

For queries regarding proposed investment in Thailand:

For other queries: Department of Foreign Affairs and Trade: (02) 6261 1111 or tafta@dfat.gov.au