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Home  / NEWS  / Thailand Investment Guide
Cabinet Backs Thailand-China Rail MOU; Thailand-EFTA FTA Targets 2027
2026-10-23

Thailand made progress on three fronts of external economic cooperation this week: on 20 October, the Cabinet approved signing a memorandum of understanding on railway cooperation with China's National Railway Administration; the Ministry of Commerce said the Thailand-European Free Trade Association (EFTA) FTA is targeted to enter into force on 1 January 2027; and Thailand aims to conclude the Thailand-EU FTA negotiations within 2026.

Thailand-China Railway Cooperation MOU

At its meeting on 20 October, the Cabinet approved the draft "Memorandum of Understanding on Strengthening Cooperation in the Field of Railways" between the Ministry of Transport and China's National Railway Administration. Cooperation covers exchanging experience in development strategies and in drafting related laws and standards, promoting exchanges of experts and knowledge, supporting the training and development of rail transport personnel, and advancing railway technology and industry in manufacturing and maintenance. The MOU has a term of three years, extendable by two years each time; it is not legally binding, and cooperation will be conducted in accordance with the relevant rules of both countries.

The Ministry of Foreign Affairs and the Office of the Council of State consider that the MOU does not constitute a treaty under international law; the Office of the National Economic and Social Development Council suggested that the Department of Rail Transport consider having the Rail Technology Research and Development Institute serve as the main responsible body, coordinating related activities with public and private organizations in Thailand and abroad. The Cabinet summary states that the cooperation will help Thailand draw on China's experience in railway regulations and standards, safety rules, manufacturing and maintenance technology, and personnel training.

Thailand-EFTA FTA: Targeted to Enter into Force on 1 January 2027

The Ministry of Commerce announced on 17 October that the Deputy Prime Minister and Minister of Commerce received the State Secretary of Switzerland's State Secretariat for Economic Affairs, along with representatives of Swiss companies and chambers of commerce, on 16 October. Both sides said the Thailand-European Free Trade Association (EFTA) FTA is targeted to enter into force on 1 January 2027, and both are currently completing domestic procedures. Swiss companies including Nestlé, Kuehne+Nagel, Novartis, Roche and Oerlikon presented their investment or cooperation plans in Thailand. The two sides discussed intellectual property protection, reducing tariff barriers and using digital systems to facilitate business. The Minister of Commerce said the value of an FTA lies not only in concluding it but in businesses actually using it; the Ministry of Commerce will help SMEs meet international standards and connect with multinational supply chains, attract investment in advanced technology, innovation and renewable energy, and place emphasis on knowledge transfer and skills development.

Data show that Thailand-Switzerland trade reached USD 14.236 billion in 2025, up 31.12%, and USD 9.557 billion in January-August 2026, up 26%.

On the same day, the Prime Minister of Thailand held talks with the Prime Minister of Liechtenstein; the government website reported that both sides agreed to advance an agreement for the avoidance of double taxation, with the Ministry of Finance responsible.

Thailand-EU FTA: Aiming to Conclude Within the Year

The Ministry of Commerce announced on 19 October that the Thai Trade Representative met the Dutch Minister for Foreign Trade and Development Cooperation on 14 October, supporting faster Thailand-EU FTA negotiations with the aim of concluding them within 2026, and asked the Dutch side to support opening markets for Thai white rice, chicken and canned tuna; the Dutch side focused on industrial policy and trade competition. The Netherlands is Thailand's 19th-largest trading partner and its second-largest within the EU. In 2025, Thailand-Netherlands trade totaled USD 7.968 billion, with Thai exports of USD 7.020 billion and imports of USD 948 million.

Key Points

  • The Cabinet approved signing the Thailand-China railway cooperation MOU, with a three-year term extendable by two years each time; it is not legally binding.

  • The Thailand-EFTA FTA is targeted to enter into force on 1 January 2027, with both sides completing domestic procedures.

  • Thailand and Liechtenstein agreed to advance an agreement for the avoidance of double taxation.

  • The Thailand-EU FTA negotiations are targeted for conclusion within 2026.

Z&X Insight

Once an FTA takes effect, tariff preferences depend on certificates of origin. Thai factories exporting to Europe should check the rules of origin for their products and their supply chain structure in advance; where cross-border payments are involved, the relevant tax treaty should also be considered. Z&X Annual Finance & Tax Advisory Retainer includes advisory modules such as "International Tax Treaties and Policy" and "Cross-Border Transactions and Pricing", and can provide advice on specific transactions.

Sources

  • สรุปข่าวการประชุมคณะรัฐมนตรี 20 ตุลาคม 2569 (Summary of the Cabinet Meeting, 20 October 2026), item 12: ร่างบันทึกความเข้าใจระหว่างกระทรวงคมนาคมแห่งราชอาณาจักรไทยและทบวงการรถไฟแห่งชาติสาธารณรัฐประชาชนจีน ว่าด้วยการเสริมสร้างความร่วมมือด้านระบบราง (Draft Memorandum of Understanding between the Ministry of Transport of the Kingdom of Thailand and the National Railway Administration of the People's Republic of China on Strengthening Cooperation in Railways) | Secretariat of the Prime Minister | 2026-10-20 | https://www.thaigov.go.th/th/news/170354

  • "ศุภจี" เปิดกระทรวงฯ รับทัพนักธุรกิจยักษ์ใหญ่สวิส ดัน FTA ไทย–EFTA สร้างประโยชน์ร่วม เชื่อม SMEs สู่ห่วงโซ่อุปทานโลก (Suphajee Welcomes Major Swiss Business Delegation to the Ministry, Pushes Thailand-EFTA FTA for Mutual Benefit and Links SMEs to Global Supply Chains) | Ministry of Commerce | 2026-10-17 | https://www.moc.go.th/th/gallery/category/detail/id/5/iid/2283

  • 'ผู้แทนการค้าไทย' หารือรัฐมนตรีการค้าเนเธอร์แลนด์ หนุนเร่งสรุปผล FTA ไทย-EU ส่งเสริมความร่วมมือ'เทคโนโลยี-ลงทุน' (Thai Trade Representative Meets Dutch Trade Minister, Backs Faster Conclusion of Thailand-EU FTA and Technology and Investment Cooperation) | Ministry of Commerce | 2026-10-19 | https://www.moc.go.th/th/gallery/category/detail/id/5/iid/2287

  • ไทย - ลิกเตนสไตน์ ยินดีความสัมพันธ์ราบรื่น ดันความตกลง Thailand- EFTA เว้นเก็บภาษีซ้อน ยกระดับการค้าการลงทุนสองฝ่าย (Thailand and Liechtenstein Welcome Smooth Relations, Push Thailand-EFTA Agreement and Double Taxation Avoidance to Enhance Bilateral Trade and Investment) | Royal Thai Government website | 2026-10-16 | https://www.thaigov.go.th/th/news/170248

BOI Approves Toyota Hydrogen Pickup; EV Batteries to Require Certification
On 19 October, the BOI approved a THB 1.49 billion investment by Toyota to produce hydrogen fuel cell pickups in Chachoengsao Province, with annual capacity of 3,000 units and production starting in December 2027; the next day, the Cabinet approved two draft Ministerial Regulations requiring EV traction batteries to meet Thai Industrial Standards, taking effect 180 days after publication in the Royal Gazette.
BOI Approves Toyota Hydrogen Pickup; EV Batteries to Require Certification
Home Workers Protection Amendment Proposes 15% Interest on Late Pay
The Thai government announced on 22 October that an amendment to the Home Workers Protection Act has been submitted to the House of Representatives: employers who fail to pay home workers on time must pay default interest at 15% a year, plus a further 15% for every full seven days of willful default; the scope of the law is proposed to expand from industry to commerce, agriculture and services.
Home Workers Protection Amendment Proposes 15% Interest on Late Pay
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