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EU Scales Back Ties With Thailand; Bloc Will Put Signing of Political Pact on Hold, Suspend Official Visits After Coup

EU Scales Back Ties With Thailand

Bloc Will Put Signing of Political Pact on Hold, Suspend Official Visits After Coup

LAURENCE NORMAN

June 23, 2014 2:58 p.m. ET

LUXEMBOURG—The European Union will scale back political ties with Thailand following the recent coup, putting on hold the signing of a political pact and suspending official visits, the bloc said Monday.

At a meeting of foreign ministers in Luxembourg, the EU also signaled it will freeze talks on a possible trade deal and said it could announce further penalties if the situation in Thailand deteriorates.

In a statement, the foreign ministers expressed “extreme concern” about the recent developments. The bloc urged Thailand’s new authorities to release political detainees and to refrain from further arrests and remove censorship.

“Fully functioning democratic institutions must be brought back to ensure the protection and welfare of all citizens,” the EU said.

Thailand’s army chief announced last month that the military had taken power, two days after the army declared martial law amid a political conflict between supporters and opponents of ousted Prime Minister Yingluck Shinawatra.

Last November, the EU gave initial approval to a political agreement with Thailand that also could have paved the way for a new trade accord. Negotiations on a trade deal had already started.

The foreign ministers said “official visits to and from Thailand have been suspended” and that the bloc won’t sign the political agreement—the Partnership and Cooperation Agreement—until “a democratically elected government is in place.”

The bloc said “other agreements will, as appropriate, be affected.” Member states have started reviewing their military ties with Thailand, the EU said. An official said no dates are being considered for resuming trade talks.

“The EU will keep its relations with Thailand under review and will consider further possible measures, depending on circumstances,” the bloc said.

The EU is the second-biggest investor in Thailand and the Asian country’s third-biggest trade partner, with exports and imports valued at almost €30 billion, or about $41 billion, according to the most recent annual figures.

 

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KB Kee is the Managing Editor of the Moat Report Asia (www.moatreport.com), a research service focused exclusively on highlighting undervalued wide-moat businesses in Asia; subscribers from North America, Europe, the Oceania and Asia include professional value investors with over $20 billion in asset under management in equities, some of the world’s biggest secretive global hedge fund giants, and savvy private individual investors who are lifelong learners in the art of value investing. KB has been rooted in the principles of value investing for over a decade as an analyst in Asian capital markets. He was head of research and fund manager at a Singapore-based value investment firm. As a member of the investment committee, he helped the firm’s Asia-focused equity funds significantly outperform the benchmark index. He was previously the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. KB has trained CEOs, entrepreneurs, CFOs, management executives in business strategy, value investing, macroeconomic and industry trends, and detecting accounting frauds in Singapore, HK and China. KB was a faculty (accounting) at SMU teaching accounting courses. KB is currently the Chief Investment Officer at an ASX-listed investment holdings company since September 2015, helping to manage the listed Asian equities investments in the Hidden Champions Fund. Disclaimer: This article is for discussion purposes only and does not constitute an offer, recommendation or solicitation to buy or sell any investments, securities, futures or options. All articles in the website reflect the personal opinions of the writer.

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