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The Governments of the Kingdom of Thailand and the Kingdom of Bahrain, hereinafter called individually "the Party" and collectively "the Parties";

Desiring to strengthen the special bonds of friendship and economic relations and co-operation that exist between them with a view to raising living standards, promoting economic growth, investment opportunities, employment, development and prosperity;

Desiring to raise the capacity and international competitiveness of their goods and services;

Aspiring to promote their mutual interests through liberalization and expansion of trade and investment between them and with a view to establishing a Free Trade Area;

Re-affirming their respective rights and obligations under existing bilateral, regional and multilateral agreements and in conformity with Article XXIV of the General Agreement on Trade and Tariffs 1994 ("GATT") and Article V of the General Agreement on Trade in Services ("GATS");

Re-affirming their commitments to strengthen and reinforce the multilateral trading system as reflected by the World Trade Organisation ("WTO") and to contribute to regional and international co-operation; and

According to the Joint Declaration on Bahrain-Thailand Closer Economic Partnership;

HAVE AGREED as follows:


The Parties shall use their best endeavours to:
1. create favourable conditions for greater economic co-operation and to promote fair competition;

2. eliminate barriers to trade in, and facilitate the cross-border movement of, goods and services between the territories of the Parties;

3. increase substantially investment opportunities in the territories of the Parties;

4. create effective procedures for the implementation and application of this Agreement; and

5. provide adequate and effective protection and enforcement of intellectual property rights in the territories of the Parties.


1. Each Party shall reduce its customs duties on goods originating from the territory of the other Party by the 29th Day of December 2002 to between zero (0%) per cent and three (3%) per cent in accordance with the list set out in the Schedule annexed hereto and shall use its reasonable endeavours to reduce the customs duties for commodity tariff lines in stages to zero percent (0%) by 2010.

2. Each Party shall:

2.1 not impose any other duty (other than customs duties) which have an equivalent effect;

2.2 not impose quantitative restrictions on imports originating in the territory of the other party; and

2.3 endeavour to reduce non-tariff barriers on goods (other than those non-tariff barriers permitted by the WTO.)

3. Neither of the Parties shall introduce a new customs duty or new quantitative restrictions on imports between the two Parties.

4. If one Party to this Agreement finds that the other Party is dumping goods in its territory, then the Parties agree to apply the provisions of the WTO Agreement on Implementation of Article VI of GATT 1994 ("the WTO Anti-Dumping Agreement") to prevent such dumping. In any event the parties agree to under take consultations before the imposition of any final anti-dumping duties.


1. Each Party shall, in a manner consistent with the objectives of this Agreement endeavour to administer effectively and uniformly the rules regarding eligibility for preferential tariff treatment set out in this Agreement.

2. Originating goods and products imported into the territory of the Parties shall be eligible for preferential tariff treatment if they conform to the following requirements;

2.1 The goods or products were wholly produced by or obtained from natural resources arising in the territory of the exporting Party; or

2.2 the goods or products were partly produced in the territory of the exporting Party and have value added of at least 40%.

3. Guidelines for implementation of the Rules of Origin will be established by the Joint Committee.


1. This Article applies to measures by a Party affecting trade in services between the Parties.

2. With respect to market access each Party shall accord services and service suppliers of the other Party treatment no less favourable than that provided for under the terms, limitations and conditions to be agreed and specified by the Technical Working Group.

3. Each Party shall liberalize and promote trade in services giving priority to finance, including banking, Islamic banking, insurance and joint ventures, education and training, tourism, healthcare, transport and communication, and construction, by the 1st of January 2004.


1. Each Party shall encourage and create favourable conditions for investors of the other Party to invest in its territory and to collaborate through joint ventures, joint investments or any other form of investment.

2. This Article shall be construed in accordance with the Agreement between the Parties for the Promotion and Protection of Investments signed on the 21st of May 2002.


A Party shall apply safeguard measures, either in the form of a duty or quantitative restrictions, only to the extent necessary to prevent or remedy serious injury in accordance with WTO rules and regulations.

Part 2


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