“It’s not worthwhile nor wise to delay decisions since the United States can arbitrarily identify major Thai exports including jewelry as targets for trade retaliation, “warned Prida Tiasuwan, vice president of the Thai Gem and Jewelry traders Association and also managing director of Pranda Jewelry Co.

          Thai jewelry exports to the United States last year rose to 1.1 billion baht (43.6 million U.S. dollars) and neared 5.8 billion baht (231 million U.S. dollars) the first three months of this year, commerce Ministry figures showed. More recent trade figures were not available, ministry officials say.

          In May, the Office of the United States Trade Representative identified Thailand and seven other trading partners as those countries denying protection of intellectual property rights and market access to American companies. The seven included Brazil, India, Mexico, China, South Korea, Saudi Arabia and Taiwan.

          Their status under “Special 301” intellectual property provisions of the Omnibus Trade and Competitiveness Act of 1988 again comes under review no later than November 1.

          The decision in May was supported by key sectors of the American business community who strongly complained about inadequate foreign intellectual property protection.

          Prida cautioned that failure to settle the problem after the 150-day assessment period could lead to an “economic war.” “Here we have a very serious problem and we must get things done quickly and   correctly.” Prida told JewelSiam. “If by November 1st, nothing is done, then it is a real matter of survival.”

          If by then, the United States finds that Thailand has not gone far enough to adequately protect American intellectual property, then the USTR could consider designating Thailand a “priority country” under the Special 301 provisions, according to the U.S. Embassy in Bangkok.

          Within 30 days after the identification of priority countries under Special 301, the USTR must initiate Section 301 investigations and retaliation determinations must be made within six months of the start of the investigation or up to nine months if considerable progress is being made, the embassy said.

          A U.S. government official, speaking on condition of anonymity, said one effect of initiating the investigation could be a ‘drying up of virtually all orders for Thai products identified in the category for trade retaliation.”

          He said protectionist U.S. producers competing with the Thais in the steel, cast iron, textile and artificial flower industries could come out of the woodwork and be expected to make their views known to the USTR during the critical public comment period. If those views are not reconciled, then the USTR could move to impose 100 percent duty on Thai imports, he said.

          “U.S. petitioners would much prefer getting at the root cause in getting a better deal for their products in Thailand,” said the official, referring to unhappy American pharmaceutical and tobacco companies. The government of Prime Minister Chatichai Choonhavan backs the Thailand Tobacco Monopoly while favoring a longstanding ban on imported cigarettes citing health warning — a move that has further strained bilateral trade relations.

          The U.S. official advised Thailand’s private sector to make its views regularly known to the government. “We would hope those views will bring additional flexibility to the Thai government while the 301 investigation is filed or started.” he said.

          Prida said the Thai Gem and jewelry Traders Association was trying to involve six other Thai trade associations whose exports could also face U.S. retaliation. The grouping includes footwear, artificial flowers, textiles, furniture and household items, toys and conned food. Prida has criticized the Thai government for neglecting the export business which he described a “new field.”

          “We don’t have a government that looks after 9and) protects the interests of exports, just a number of knowledgeable technocrats with foresight but otherwise powerless to push policy,” complained Prida. “As November draws near ….”

          In a nutshell, the United States will look for the following from Thailand:

—improved and adequate patent protection for all classes of inventions;

—effective copyright protection for U.S. works including computer software;

—improved protection of foreign trademarks; and

—constructive participation in multinational intellectual property talks.

The U.S. government official said the November review was neither an ironclad timetable nor a legal deadline and noted that it could have similarities with the thrice-delayed decision on the U.S. Generalized System of Preferences. A GSP ruling was initially set for April last year, then deferred to December and finally announced on Jan. 20 with the inauguration of U.S. President George Bush.

Under GSP, Thai exports worth millions of baht entered the United States duty-free or with reduced tax. Precious Thai jewelry now is subject to a 6.5 percent tariff and 11 percent for most costume jewelry after shipments last year exceeded quotas.

The official however quickly added: “There may be no reasons to defer the deadline if there are some backward movements.”

 “If the U.S. pharmaceutical industry steps up pressure and others follow, then there could be a decision made.” he said.

Thai law allows manufacturers to duplicate drugs protected by patents registered outside Thailand. Foreign pharmaceutical firms say the copies are substandard while Thai companies contend they can produce quality drugs cheaply.

On patent law reform, the official said the United States would like to see commitment by Thailand to the concept of patent law and pharmaceutical patent. Some 5,500 drugs including imported medication are available in Thailand and of those, at least 28 are copied without authorization, he said.