AUTHORS: Eline Blot, Nora Hiller, Auriane Flottes de Pouzols

This briefing assesses trade-related sustainability challenges in Thailand relevant to the Free Trade Agreement with the EU and proposes recommendations to further environmental and climate cooperation and progress between the two parties.

After a decade of stalled negotiations, the EU and Thailand reignited trade talks in March 2023 seeking to deepen trade ties in the Southeast-Asian market and contribute to supply chain diversification. Thailand stands out a manufacturing powerhouse, driven by its automotive, electronics, and food processing industries. Since trade talks relaunched, seven negotiation rounds have taken place, the latest occurring in late September 2025 in Brussels. While Thai officials initially aimed to conclude talks by the end of 2025, expectations have since shifted toward agreeing on roughly half of the agreement by year’s end.

Almost 75% of EU imports from Thailand are manufactured goods such as machinery and transport equipment, while imports of Thai agri-food products represent a smaller share (11%). In 2024, Thailand’s economy is export orientated with exports of goods and services making up 70% of its GDP.

As a low-lying country with long coastlines and a rapidly urbanising population, Thailand is among the most climate-vulnerable nations in the world. Bangkok, built just 1.5 meters above sea level, faces acute risks from sea-level rise and land subsidence, with some projections suggesting parts of the city could be underwater by 2050. Shifts in rainfall patterns and rising temperatures threaten agricultural productivity, particularly rice yields, which are essential for food security and livelihoods. This briefing focuses on three main trade-related sustainability challenges: Industrial production and pollution, overexploitation of marine resources, and biodiversity concerns linked to deforestation, illegal wildlife trade and captive wildlife.

Industrial production, central to Thailand’s export economy, drives high greenhouse gas (GHG) emissions and severe air and water pollution, with fossil fuel dependence and weak waste management contributing to one of the world’s highest levels of plastic pollution. In the fisheries sector, overexploitation, shrimp-farming disease, and invasive species threaten marine ecosystems and long-term export capacity, while past concerns over illegal, unreported, and unregulated (IUU) fishing have required close cooperation with the EU to maintain market access. Biodiversity pressures stem from continued deforestation, agricultural expansion, and the illegal wildlife trade, compounded by exploitative wildlife tourism.

As a major exporter of industrial, seafood, and agricultural products, Thailand’s environmental performance is increasingly under scrutiny from international partners linking market access to sustainability standards, underscoring the need for stronger regulation, traceability, and conservation measures to safeguard competitiveness and ecosystems alike. To this end, this briefing puts forward several recommendations for the EU-Thailand TSD Chapter tailored to address country-specific sustainability issues, include more binding commitments to the implementation of MEAs, and facilitate cooperation and dialogue on both tackling sustainability concerns and seeking joint understanding and regulatory coherence regarding trade-related sustainability measures.

Recommendations

• Formalise bilateral dialogues within the FTA and encourage multilateral engagement on both the implementation of sustainability measures affecting trade (such as ESPR, CBAM, EUDR and CSDDD), and regulatory cooperation concerning trade in sustainable goods and services.
• Ensure TSD provisions should spur parties to operate a fisheries management system to prevent IUU fishing, overfishing, and overcapacity, while promoting stock recovery and minimising bycatch.
• Require parties to align aquaculture practices with World Organisation for Animal Health standards and Kunming-Montreal Global Biodiversity Framework (GBF) targets, addressing biodiversity loss and environmental sustainability.
• Include binding provisions to effectively implement the Paris Agreement and the Montreal-Kunming GBF, acknowledging the role of protected area conservation in combating climate change impacts.
• Ensure the effective implementation of CITES and the Convention on Biological Diversity (CBD), with a focus on reducing biodiversity loss, restoring ecosystems, and preventing illegal wildlife trade.
• Close regulatory loopholes that allow domestic trade and exploitation of wildlife (e.g., elephant tusks, exotic pets, tourism animals) and phase out laws permitting the domestication of wild animals.
• Promote sustainable forest management, combat illegal logging, and cooperate on measures to minimise commodity-driven deforestation and forest degradation. Cooperative dialogue should enhance biodiversity outcomes and mitigate potential negative social impacts of the EU Deforestation Regulation (EUDR).
• Negotiate a roadmap with time-bound targets to address sustainability challenges in Thailand, linking to international agreements and conventions where applicable.

This briefing is part of a IEEP policy series monitoring upcoming free trade agreements that are either being negotiated or concluded. For more briefings assessing the environmental sustainability of future FTAs, consult this page.