Thailand may shun Airbus over 'unfair' EU trade

Thailand may shun Airbus over 'unfair' EU trade

Panarat Thepgumpanat, Reuters, Bangkok

Thai Prime Minister Thaksin Shinawatra said on Wednesday his
government may review future plans to buy Airbus planes if the
European Union continued to treat Thailand's agricultural exports
"unfairly".

Thaksin told reporters Thailand's trade with the European
Union was at a disadvantage compared to other countries at a
comparable level of development, such as Malaysia.

"Malaysia has trade privileges, but Thailand does not. They
can't say that we are in a better position. It's not fair," he
said. "If they treat us unfairly, we will treat them the same
way."

"We are expanding terminals for new aircraft and we plan to
buy Airbus planes from the EU. But if the EU is not fair with us,
we will also be uncomfortable in buying their planes."

Thailand might turn to Boeing Co instead, he said.

Airbus SAS is owned 80 percent by European Aeronautic, Defense
& Space Co NV (EADS), based in Germany and France, and 20 percent
by Britain's BAE Systems Plc.

Airbus said in August that Thai Airways International PCL had
ordered eight planes after winning approval to spend US$1.4
billion over the next five years to boost its fleet. Thaksin said
that order was not in doubt.

But Thailand is beginning negotiations with the European plane
giant on further planes for both national carrier Thai Airways
and the Royal Thai Air Force, domestic media say.

Civil-oriented Airbus has a limited range of military
products: the A400M military transport, and tanker and VIP
versions of its airliners. The Thai air force has been authorized
to buy a second VIP plane.

Thaksin's comments followed domestic media reports quoting
Commerce Minister Wattana Muangsuk as saying the Thai government
should get tough with Airbus.

That would increase pressure on the European Union to lighten
its tariffs on Thai shrimp exports at a time of domestic
oversupply and low prices, Wattana said.

Future plane purchases from Airbus should take into
consideration how accommodating the EU was to shrimp exports from
Thailand, the world's biggest frozen shrimp exporter, Wattana
said.

He said Thailand had been treated unfairly by the European
Union, because Thai shrimps were subject to import tariffs as
high as 12 percent, while shrimps from Malaysia, which had "EU
Generalized System of Preferences" status, faced only a four
percent tariff.