Peru to review ban on Thai rice imports

TNA | 19 October 2004

Peru to review ban on Thai rice imports

PERU, Oct 19 (TNA) - Thailand and Peru have edged closer to forming a free trade area (FTA) following discussions between Thai Trade Representative Kantathir Suphamongkhon and Peruvian President Alejandro Toledo, in which the Peruvian leader promised to exercise greater trade flexibility with Thailand than with other countries, and to review a ban on the import of Thai rice.

Peru’s decision to ban Thai rice imports came on the back of fears that rice could harbour the avian flu virus, a claim rubbished by Mr. Kantathir during his recent talks with Peruvian Agriculture Minister Alvaro Salmon.

The subtext, however, appeared to be the protection of Peruvian rice farmers, with rice making up one of Peru’s five key crops.

However, Mr. Kantathir said that the Peruvian agricultural minister had conceded to send a delegation to Thailand next month when the ban will be reviewed.

The review apparently comes at the direct request of the Peruvian president, who is keen to ensure that rice does not pose an obstacle to the establishment of the proposed Thai-Peruvian FTA.

President Toledo’s order follows the threat of a counterattack from Thailand in the form of a ban on Peruvian animal feed, apparently over fears of the spread of bovine spongiform encephalopathy, or mad cow disease.

Following the success of the talks, the 4th in a series of FTA negotiations, it is now highly likely that an FTA deal between the two countries will be signed between Prime Minister Thaksin Shinawatra and President Toledo when the two leaders attend next month’s Asia Pacific Economic Cooperation (APEC) meeting in Chile.

If successful, the deal would be the first FTA between Thailand and a Latin American country, and, similarly, the first deal of its kind between Peru and a country in Asia.

Thailand hopes to use Peru as a gateway to Latin America and its 500 million-strong population, as well as the Andean states, which would afford Thailand backdoor access to the US market.

Peru would, likewise, use Thailand as a gateway to the Association of Southeast Asian Nations (ASEAN).

source: TNA