Order Code RL32593
CRS Report for Congress
Received through the CRS Web
Thailand:
Background and U.S. Relations
January 13, 2005
Emma Chanlett-Avery
Analyst in Asian Affairs
Foreign Affairs, Defense, and Trade Division
Congressional Research Service ˜ The Library of Congress

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Thailand:
Background and U.S. Relations
Summary
U.S.-Thailand relations are of interest to Congress because of Thailand’s status
as a long-time military ally with ongoing relevance to U.S. logistical operations in
Iraq, a key country in the war against terrorism in Southeast Asia, and a significant
trade and economic partner. A proposed U.S.-Thailand Free Trade Agreement
(FTA), currently being negotiated, would require implementing legislation to take
effect.
Despite differences on Burma policy and human rights issues, shared economic
and security interests have long provided the basis for U.S.-Thai cooperation.
Bangkok and Washington coordinate closely on law enforcement, intelligence, and
military operations. Thailand contributed troops and support for U.S. military
operations in both Afghanistan and Iraq and was designated as a major non-NATO
ally by President Bush in December 2003. Thailand’s airfields and ports play a
particularly important role in U.S. global military strategy, including serving as the
primary hub of the relief effort for the Indian Ocean tsunami. The high-profile arrest
of radical Islamic leader Hambali in a joint Thai-U.S. operation underscores
Thailand’s role in the U.S.-led war on terrorism. If negotiations for an FTA are
successful, the current U.S.-Thai bilateral trade total of $20 billion could rise
considerably.
Current Prime Minister Thaksin Shinawatra and his populist Thai Rak Thai
party have consolidated broad control of Thai politics and continue to enjoy
widespread public support, although opposition parties and others have criticized his
strongman style as a threat to Thailand’s democratic institutions. The central
government’s forceful response to a surge of violence in the southern majority-
Muslim provinces of Thailand has also come under fire from some observers. A
series of attacks by insurgents, which has claimed over 500 lives, has renewed
concerns about both indigenous and transnational terrorism in the country. Some
commentators have speculated that southern Thailand could become another front in
the U.S.-led war on terrorism if further links to international terror networks surface.
With its favorable geographic location and broad-based economy, Thailand is
poised to play a major leadership role in Southeast Asia and has been an aggressive
advocate of increased economic integration in the region. A founding member of the
Association of Southeast Asian Nations (ASEAN), Thailand maintains close ties with
China, has reached out to India, and is actively pursuing FTAs with a number of
other countries. Given its deepening ties with the United States, Thailand’s growing
stature in the region may affect broader U.S. foreign policy objectives and prospects
for further multilateral economic and security cooperation in Southeast Asia. In the
context of the Pentagon’s transformation and realignment initiatives, current
logistical facilities in Thailand could become more important to U.S. Asia-Pacific
strategy. This report will be updated periodically.

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Contents
Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Coping with Tsunami Disaster . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Violence in Southern Provinces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Central Government Response . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Possible Foreign Involvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Criticism of Thaksin’s Approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Background: Thailand Politics and Government . . . . . . . . . . . . . . . . . . . . . . . . . 5
Path to Democratization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Thaksin’s Government Consolidates Power . . . . . . . . . . . . . . . . . . . . . . . . . 5
Recent Military Deployments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
U.S.-Thai Partnership Elevated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Intelligence Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Joint Law Enforcement Efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Human Rights Concerns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
U.S.-Thailand Trade and Economic Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1997 Economic Crisis Recovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Central U.S. Role . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
A Protracted Process for U.S.-Thailand FTA Negotiations? . . . . . . . . . . . . 11
An Aggressive FTA Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Thailand in Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Growing Ties with China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Divergence with U.S. on Burma (Myanmar) Policy . . . . . . . . . . . . . . . . . . 13
ASEAN Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Regional Health Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Upcoming Challenges and Opportunities in Bilateral Ties . . . . . . . . . . . . . . . . . 15
Progress in FTA Negotiations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Military Transformation in Asia-Pacific . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Direction of War on Terrorism in Southeast Asia . . . . . . . . . . . . . . . . . . . . 16
List of Tables
Table 1. U.S. Assistance to Thailand, FY2002-FY2005 . . . . . . . . . . . . . . . . . . . 17
List of Figures
Figure 1. Map of Thailand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

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Thailand:
Background and U.S. Relations
A long-time American ally in Asia, Thailand has become increasingly close with
the United States as the political landscape of the region has evolved. Solidified
during the Cold War, the U.S.-Thai relationship strengthened on the basis of shared
economic and trade interests, and it has been further bolstered since the September
11, 2001 attacks by a common commitment to fight terrorism in Southeast Asia.
Although U.S. military alliances with Japan and South Korea dominate coverage
of America’s strategic presence in East Asia, Thailand has emerged as a significant
and reliable partner for the United States. Designated as a major non-NATO ally in
2003, Thailand contributed troops and support for recent U.S. military operations in
both Afghanistan and Iraq. Thailand has been an active partner in the U.S.-led war
on terrorism, a role highlighted by the high-profile arrest of a radical Islamic leader
in a joint Thai-U.S. operation. Other bilateral cooperation on transnational issues
such as money laundering and narcotics trafficking reinforces Thailand’s standing as
a primary partner of the United States in maintaining stability in the region.
The start of negotiations on June 28, 2004 for a U.S.-Thailand Free Trade
Agreement (FTA) marked Thailand’s possible entry into the United States’
expanding web of trade pacts with political allies. If the negotiations are successful
in working out a host of controversial issues, the current U.S.-Thai bilateral trade
total of $20 billion is likely to rise considerably. Including Thailand for FTA
consideration follows a pattern of linking FTA negotiating status with support for
U.S. foreign policy and national security goals that U.S. Trade Representative Robert
Zoellick noted in a 2003 address.1 In Asia specifically, the United States has
concluded FTAs with Australia and Singapore, also strong political allies who have
supported U.S. efforts in the war on terrorism.
Thailand’s position within ASEAN makes it an appealing ally for the United
States. Prime Minister Thaksin Shinawatra has consolidated power at home and
positioned himself to be a major leader for Southeast Asia as well by shoring up
relations with neighboring countries, standing up for the ASEAN policy of non-
interference in the domestic affairs of other states, and maintaining strong ties with
regional giants China and India. Many analysts have predicted that Thaksin could
be “the next Mahathir,” referring to the charismatic former Malaysian prime minister
credited with leading Malaysia’s impressive development during his 22-year tenure.
The comparison with Mahathir also reflects concerns that Thaksin sometimes resorts
to authoritarian governing methods.
1 See CRS Report RS21657, U.S. Trade Policy and Changing Domestic and Foreign
Priorities: A Historical Overview, by Raymond J. Ahearn.

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CRS-2
Recent Developments
Coping with Tsunami Disaster
Six provinces on the western coast of southern Thailand, particularly the Phang
Nga province and the resort islands of Phuket and Phi Phi, were badly hit by sea
surges stemming from the underwater earthquake off of Sumatra on December 26,
2004. The official death toll in Thailand stood at 5,303 dead and 3,396 missing, with
most of the missing presumed dead.2 Officials said that about half of the dead were
foreign vacationers, many from Europe. Many oceanfront properties, particularly
hotels, were destroyed. Compared to other affected nations, however, the
infrastructure in Thailand was left relatively unscathed: the regional electricity grid
and telecommunication network continued to function, and the transportation system
and water supply in Phuket were largely unaffected.
The emergency response in Thailand was praised by the international
community: United Nations and Australian relief agency officials described effective
and rapid coordination of grass-roots relief teams to distribute supplies and provide
first aid. Some credit Thaksin’s strong political authority to command the military
and police forces. Thaksin has also come out strongly in favor of establishing a
tsunami alert system in cooperation with other regional governments. Thailand also
appears to have met the unique diplomatic and logistical challenges of coordinating
the recovery and identification among the 38 countries that lost nationals in the
disaster. A huge effort was launched to collect DNA samples from the dead, with
several nations sending forensic experts to assist.
Thailand is the logistics hub for much of the U.S. and international relief effort.
U.S. relief operations by air and sea for the entire region were directed out of
Thailand’s Utapao air base and Sattahip naval base. Thailand’s government
immediately granted full U.S. access to the bases following the disaster.
Representatives from Japan, Singapore, the United Nations, the World Food
Program, and the World Health Organization are also working out of Utapao.
Beyond the concerns of dealing with the dead, Thailand may suffer
economically, at least in the short term, because of the blow to its tourism industry.
The industry brings in about $8 billion annually, nearly 6% of Thailand’s GDP.
Because the tsunami struck at the peak of tourist season in Thailand, millions of
visitors are expected to cancel their plans, immediately costing operators about $750
million, analysts estimate.3 Many analysts are optimistic, however, that the industry
will rebound quickly, as only about 5-10% of Thailand’s hotels were affected and
rebuilding is expected to be swift. Some reports said that many visitors had opted to
stay at the unaffected hotels in the area, and by December 31, 2004, major
international chains were already planning how to win back visitors without
appearing insensitive. The Thai government reassured investors that it intended to
spend $768 million to repair infrastructure in the area.
2 CNN News, Jan. 11, 2005.
3 “Thailand Death Toll Could Reach 2,000,” CNN.com, Dec. 28, 2004.

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CRS-3
Violence in Southern Provinces
Since January 2004, sectarian violence between insurgents and Thai security
forces in Thailand’s majority-Muslim provinces has left over 550 people dead.4 Most
of the civilian victims have been Buddhist Thais, particularly monks and teachers;
others were police and military personnel. The southern region, which includes the
provinces of Yala, Narathiwat, Pattani, and Songhkla, has a history of separatist
violence, though the major movements were thought to have died out in the early
1990s. Thai Muslims have long expressed grievances for being marginalized and
discriminated against; the area has lagged behind the rest of Thailand in economic
development and contributes only 1.4 percent of the country’s GDP
After a series of apparently coordinated attacks in early 2004, the central
government declared martial law in the region and sent 3,000 troops south. (The
number has since grown to over 15,000, with an additional 10,000 committed for the
one-year anniversary of the upsurge in violence.) A pattern of insurgent attacks —
targeted shootings or small bombs that claim a few victims at a time — and counter-
attacks by the security forces has developed. The pattern crystallized into two major
outbreaks of violence in 2004: on April 28, Thai soldiers killed 108 insurgents,
including 34 lightly armed gunmen in a historic mosque, after they attempted to
storm several military and police outposts in coordinated attacks; and, on October 25,
84 local Muslims were killed: 6 shot during an erupting demonstration at the Takbai
police station and 78 apparently asphyxiated from being piled into trucks after their
arrest.5 The insurgents retaliated with a series of more gruesome killings, including
beheadings, followed the Tak Bai incident.
Central Government Response. In addition to the sizable military
dispatch, Bangkok has adopted measures designed to soften criticism that his policy
overly stressed the use of military force. The government has proposed aid packages
to the south, exploring the reform of the Islamic school system, and commissioned
inquiries into the military’s response in the April and October incidents. The Thaksin
Administration approved a $500 million economic development program for the
region, although local sources complain that the funds have yet to be dispersed.6 The
government has also announced plans to sponsor more Islamic schools and ban the
use of foreign funds and influence over the schools. Reflecting a belief that the
violence is being fomented in madrassas with foreign links, police have arrested
several Indonesia-educated teachers in the Islamic schools. After public outcry over
the deaths of Muslim youths by Thai troops, independent investigations led to the
dismissal or reassignment of some officials but largely acquitted the government of
any intentional misconduct.
4 Reports from BBC News and the Los Angeles Times.
5 Independent forensic experts said that the men died piled on top of each other with their
hands tied behind their backs. See Mydans, Seth, “Thai King Urges Premier to Be More
Lenient in the Muslim South," New York Times, Nov. 2, 2004.
6 Smith, Anthony L., “Trouble in Thailand’s Muslim South: Separatism, Not Global
Terrorism,” Asia Pacific Security Studies, vol. 3, no. 10 (Dec. 2004).

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CRS-4
Possible Foreign Involvement. Many regional observers view the
movement as a confluence of different groups: local separatists, Islamic radicals,
organized crime, and corrupt police forces. The sophistication and coordination of
the attacks support the notion that broader networks are involved, but the history of
resentment in the region among minority Muslims toward the central government
points to a domestic impetus. Separatist groups in Pattani have reportedly received
financial support from groups in other Islamic countries, and some of the leaders
trained in camps in Libya and Afghanistan.7 There are indications of Jemaah
Islamiah (JI) presence in Thailand,8 particularly given the 2003 arrests of Hambali,
a radical figure with suspected ties to Al Qaeda, and of three Islamic leaders
suspected of planning to attack foreign embassies and tourist destinations. However,
most analysts stress that there is no convincing evidence to date of serious JI
involvement in the attacks in the southern provinces.
Sectarian violence involving local Muslim grievances, however, provides a ripe
environment for JI to become more engaged in the struggle. Prominent experts have
warned that outside groups, including militant Indonesia-based groups and JI, may
attempt to exploit public outrage with events like the October 5 deaths to forge
alliances between local separatists and regional Islamic militants.9 Some analysts
believe that the heavy-handed response by the security forces, with the open support
of Thaksin, could represent a tipping point for the movement.
Thai authorities have reluctantly adjusted their position on the threat of Islamic
extremism, possibly with financial and operational ties to international terrorist
groups, on Thai soil. Initially, government spokesmen insisted that most of the
attacks were the work of local criminal gangs. After the October 25 incident,
Thaksin said that the militants were local but could be getting assistance from
extremists abroad through “personal contacts,” distinct from an organized
transnational network.10
Criticism of Thaksin’s Approach. The government’s handling of the
violence, particularly the response to the detainee deaths, has been widely criticized
as ineffective and inflammatory. Thaksin backtracked on his initial defense of the
security force’s actions on October 25 and the accusation that many of the deaths
were a result of Ramadan fasting, acknowledging the military’s mistakes and
expressing regret at the loss of life. However, he did not commit to changing his
approach to the south; the military also said they intended to continue their policy of
using force. Parties outside of the Administration have expressed concern about the
events. The royal family, which commands strong loyalty from the Thai public, has
7 Ibid.
8 Regional terrorism experts have pointed to linkages to JI in Thailand through the group
Jemaah Salafi, which reportedly had contact with Hambali as he was planning major
bombings in Bangkok; through personal ties with various secessionist leaders; and through
the participation in the attacks of several foreign nations with JI ties.
9 “Thailand ‘The Next Battleground,” The Australian, Dec. 1, 2004.
10 “Killings in Songkhla Raise Fears Violence is Spreading,” The Nation (Bangkok), Nov.
17, 2004.

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CRS-5
taken the unusual step of publicly intervening. In a move that may have forced
Thaksin to soften his statements, King Bhumibol Adulyadej encouraged him to take
a more measured approach. Dissent has emerged from within the elite as well: a
former prime minister and ex-Army chief have criticized the use of force and called
for campaign to restore peace in south,11 and a senior education official has urged the
creation of a new Ministry of Islamic Affairs to address the problem.12
Thailand’s neighbors also expressed alarm at the brewing insurgency, breaking
the ASEAN rule of broaching internal affairs at the November 2004 ASEAN summit
in Laos. Although Thaksin resisted attempts to add the discussion to the official
agenda, Indonesia and Malaysian leaders met with him on the sidelines to convey
their concern. Australian Foreign Minister Alexander Downer has noted the
mishandling and pointed out the potential for JI to exploit local grievances.13 The
U.S. State Department also has acknowledged its concern and intent to monitor the
situation closely.14
Background: Thailand Politics and Government
Path to Democratization
The Kingdom of Thailand, a constitutional monarchy with a parliamentary form
of government, is marked by an important historical dissimilarity from its regional
neighbors. Although occupied by Japan during World War II, Thailand was the only
country in Southeast Asia that was not colonized by Europeans, and also avoided the
wave of communist revolutions that took control of the governments of Cambodia,
Laos, and Vietnam in the 1960s and 1970s. Thailand followed a troubled path to
democracy, enduring a series of mostly bloodless coups and multiple changes of
government in its modern history. Although Thailand became a constitutional
monarchy in 1932, it was ruled primarily by military dictatorships until the early
1990’s. A military and bureaucratic elite controlled Thai politics during this period,
denying room for civilian democratic institutions to develop. Brief periods of
democracy in the 1970s and 1980s ended with reassertions of military rule. After
Thai soldiers killed at least 50 people in demonstrations demanding an end to
military dominance of the government, international and domestic pressure led to
new elections in 1992.
Thaksin’s Government Consolidates Power
Thailand’s government, composed of the executive branch (prime minister as
head of government and the king as chief of state), a bicameral National Assembly,
and the judicial branch of three court systems, is currently led by Prime Minister
Thaksin Shinawatra of the Thai Rak Thai (TRT) party. King Bhumiphol, who has
11 “Anand, Surayud Urge Peaceful Resolution,” The Nation (Bangkok), Nov. 16, 2004.
12 “Defusing the South,” The Nation (Bangkok), Nov. 15, 2004.
13 “Tackling the Thai Terror Threat,” Asian Wall Street Journal, Nov. 30, 2004.
14 State Department Press Releases and Documents, Oct. 29, 2004.

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CRS-6
served since 1946, holds little formal political power but commands tremendous
respect and loyalty from the Thai public. Until Thaksin’s election in 2001, the
Democrat Party dominated Thai politics by instituting a series of reforms that
enhanced transparency, decentralized power from the urban centers, tackled
corruption, and introduced a broad range of constitutional rights.
The TRT party, formed by Thaksin in 1999, benefitted politically from the
devastation of the 1997 Asian financial crisis on Thailand’s economy, and
subsequent loss of support for the ruling Democrats. Thaksin’s populist platform
appealed to a wide cross-section of Thais, and the TRT easily secured a clear
majority in the parliament by forming a coalition with a handful of smaller parties.
The Thaksin government has bolstered its standing by carefully courting several key
power centers: the military, the business and banking elite, provincial political
bosses, and the royal family. Many analysts contend that Thaksin and his party enjoy
power unprecedented in modern Thai politics.15
TRT was expected to easily maintain its majority in the February 6, 2005
parliamentary elections. The main opposition, the Democratic Party, was hoping to
capture 201 seats in the House of Representatives in order to maintain the minimum
number needed to propose a censure debate against the prime minister.16 Although
some pundits thought that Thaksin’s handling of the violence in the south may hurt
his popularity, his response to the tsunami disaster was viewed favorably.
While Thaksin remains popular with the general public, detractors have voiced
concern that his strongman style is a threat to Thailand’s democratic institutions.
Suspicions of cronyism and charges of creeping authoritarianism have surfaced since
Thaksin took office. Some commentators have alleged that Thaksin’s administration
has undermined anti-corruption agencies by installing political loyalists to protect the
business interests of his family and members of his cabinet.17 Outside groups have
warned that press freedom has been squeezed in recent years, documenting multiple
cases in which critical journalists and news editors were dismissed, and pointing to
a libel suit against an outspoken editor filed by a telecommunications corporation that
Thaksin founded.18 Thaksin insists that political strength enhances development,
citing Singapore’s economic success and lack of political opposition as a model for
Thailand to follow.19
15 See Ganesan, N. “Thaksin and the Politics of Domestic and Regional Consolidation in
Thailand,” Contemporary Southeast Asia, vol. 26, no. 1 (Apr. 2004).
16 Salayakanond, Wirasak. “Sound and Fury of Thaksin’s Re-election Begins,” Business
Day, Jan. 11, 2005.
17 “Thailand Risk: Alert — Corruption May Still Go Unchecked,” Economist Intelligence
Unit, July 19, 2004.
18 “Rights Group Says Libel Suit Deepens Assault on Thailand’s Media,” Agence France
Press, Aug. 31, 2004.
19 “One Party Rule: Opposition Does Not Need to Be Strong, Says PM,” The Nation
(Bangkok), Aug. 10, 2004.

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CRS-7
U.S.-Thailand Political and Security Relations
A Long-standing Southeast Asian Ally
The 1954 Manila Pact of the former Southeast Asia Treaty Organization
(SEATO), together with the 1962 Thanat-Rusk communique, forms the basis of the
long-standing U.S.-Thai security relationship. Although SEATO was dissolved in
1977, Article IV (1) of the Manila Pact, which calls for signatories to “act to meet the
common danger” in the event of an attack in the treaty area, remains in force.
Thailand is considered to be one of the major U.S. security allies in East Asia, along
with Japan, South Korea, Australia, Singapore and the Philippines.
The U.S. security relationship with Thailand has a firm historical foundation
based on joint efforts in the Korean War, the Vietnam War, and the 1991 Persian
Gulf War. Thailand sent more than 6,500 troops to serve in the United Nations
Command during the Korean War, where the Thai force suffered over 1,250
casualties.20 A decade later, the United States staged bombing raids and rescue
missions over North Vietnam and Laos from Thailand. During the Vietnam War, up
to 50,000 U.S. troops were based on Thai soil, and U.S. assistance poured into the
country to help Thailand fight its own domestic communist insurgency.21 Thailand
also sent troops to South Vietnam and Laos to aid the U.S. effort. The close security
ties continued throughout the Cold War, with Thailand serving as solid anti-
Communist ally in the region. More recently, Thai ports and airfields played a
crucial role in maintaining the flow of troops, equipment, and supplies to the theater
in both the 1991 and 2003 Iraq wars.
Recent Military Deployments
Thailand has strengthened its partnership with the United States by contributing
troops to two American military operations since the September 11, 2001 attacks.
Thailand sent 130 soldiers, largely engineers, to Afghanistan to participate in the
reconstruction phase of Operation Enduring Freedom. Thai forces are responsible
for the construction of a runway at Bagram Airbase, medical services, and some
special forces operations.22
Although Thailand remained officially neutral during the U.S.-led invasion of
Iraq, it joined the coalition to reconstruct Iraq by committing over 450 troops,
including medics and engineers, to the southern city of Karbala. The Thai troops
assisted in building roads and buildings and sent medical teams into the surrounding
areas. The deployment proved unpopular with the Thai public, particularly after the
20 See [http://korea50.army.mil/history/factsheets/allied.shtml] (official public access
website for Department of Defense Commemoration of the 50th anniversary of the Korean
War).
21 The Eagle and the Elephant: Thai-American Relations Since 1833 (Bangkok: U.S. Agency
for International Development, 1997).
22 “Thai Soldiers Help Rebuild Afghanistan,” The Nation (Thailand), July 4, 2003.

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CRS-8
deaths of two soldiers in December 2003. In spring 2004, Thaksin threatened to
withdraw the troops early if the security situation continued to disintegrate and
resisted U.S. calls to postpone the withdrawal until after the Iraqi elections. The
withdrawal was completed in September 2004.
U.S.-Thai Partnership Elevated
In October 2003, President Bush designated Thailand as a “major non-NATO
ally,” a distinction which allows more access to U.S. foreign aid and military
assistance, including credit guarantees for major weapons purchases.23 An agreement
concluded with the United States in July 2001 allows Thailand to purchase advanced
medium-range air-to-air missiles for its F-16 fighters, a first for a Southeast Asian
state.24 Thaksin also authorized the reopening of the Vietnam-era U.S. airbase in U-
Tapao and a naval base in Sattahip, from which the U.S. military can logistically
support forces in Afghanistan and the Middle East. Thailand and the United States
also conduct over 40 joint military exercises a year, including Cobra Gold, America’s
largest combined military exercise in Asia. The 2004 drill included nearly 20,000
troops — 13,500 Americans, 5,500 Thais, and additional participation from the
Philippines, Mongolia, and Singapore — as well as from ten other observer nations
in Asia and Europe.25 Tens of thousands of Thai military officers have received U.S.
training under the International Military Education and Training (IMET) program.26
U.S. Army personnel have trained Thai units in narcotics interdiction tactics on the
Thai-Burma border.
Intelligence Cooperation
Intelligence cooperation between Thailand and the United States has reportedly
increased markedly since the September 11, 2001 attacks. The Counter Terrorism
Intelligence Center (known as the CTIC) provides the centerpiece of the bilateral
cooperation by combining personnel from Thailand’s intelligence agency and
specialized branches of the military and armed forces. Established in early 2001, the
CTIC provides a forum for CIA personnel to work closely with their Thai
counterparts, sharing facilities and information daily, according to reports from Thai
security officials.27 Close cooperation in tracking Al Qaeda operatives that passed
through Thailand reportedly intensified into active pursuit of suspected terrorists
23 Under section 517 of the Foreign Assistance Act of 1961, the President can designate a
non-North Atlantic Treaty Organization state as a major ally for the purposes of the Foreign
Assistance Act and the Arms Export Control Act.
24 Limaye, Satu P. “Minding the Gaps: The Bush Administration and U.S.-Southeast Asia,”
Contemporary Southeast Asia, vol. 26, no. 1 (Apr. 2004).
25 “Thailand — Annual War Games Underway,” Periscope Daily Defense News Capsules,
May 14, 2004.
26 In 1997, over 20,000 had received IMET training. See The Eagle and the Elephant, p. 143.
27 Crispin, Shawn, and Leslie Lopez, “U.S. and Thai Agents Collaborate in Secret — Cold-
War-Style Alliance Strikes Jemaah Islamiyah Where It Least Expects It.” Asian Wall Street
Journal, Oct. 1, 2003.

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CRS-9
following the 9/11 strikes.28 The most public result of enhanced cooperation to date
was the arrest of suspected Jemaah Islamiyah leader Riduan Isamuddin, also known
as Hambali, outside of Bangkok in August 2003.
Some observers suggest that heightened cooperation with the United States has
not been without consequences for Thailand. Initially the joint efforts were carried
out with discretion; some Thai security officials even claim that the public
maintenance of Thailand’s neutrality was part of the strategy to lure potential
terrorists to the country in order to track their movements.29 Some say that
Thailand’s higher profile cooperation with the United States has raised regional and
intra-Thai tensions. Press reports cite frustration on the part of Indonesian and
Filipino security officials after arrested terrorist suspects, including Hambali, were
detained by U.S. and Thai officials without allowing other regional powers to
question the suspects.30 The highly publicized joint operation that captured Hambali
may have fueled perceptions in the region that the CIA is directing the joint
operations, in contrast to Malaysia and Singapore, which reportedly carry out
surveillance and police work largely on their own.
Joint Law Enforcement Efforts
Bilateral cooperation with Thailand in law enforcement has moved forward with
the involvement of other Southeast Asian countries. In 1998, the International Law
Enforcement Academy (ILEA) Bangkok was established to provide legal training for
officials to combat transnational crime.31 The center is open to government officials
from any Southeast Asian country, with the exception of Burma (Myanmar), and had
trained over 3,100 participants by September 2003. ILEA aims to enhance law
enforcement capabilities in each country, as well as to encourage cross-border
cooperation.
The curriculum offered at ILEA-Bangkok includes a six-week core program of
courses that emphasize human rights, officer safety, investigation techniques,
computer crime, and a variety of transnational issues such as money laundering, drug
and human trafficking, and regional terrorism. Other specialized courses are
available in various investigative methods and intelligence analysis. Instruction for
the courses is provided largely by the Royal Thai Police, the Thai Office of the
Narcotics Control Board, and various U.S. agencies, including the Diplomatic
Security Service, the Federal Bureau of Investigation, the Drug Enforcement Agency
(DEA), the Department of Homeland Security, and the Internal Revenue Service.32
28 Ibid.
29 Ibid.
30 Lopez, Leslie, “U.S. Grip on Terror Suspect Irks Some Asian Officials — After
Cooperative Manhunt Led to Hambali’s Capture, Governments Seek Access,” Asian Wall
Street Journal, Aug. 20, 2003.
31 ILEA-Bangkok is one of four ILEAs in the world. The others are located in Hungary,
Botswana, and Roswell, New Mexico.
32 Course information from [http://www.ileabangkok.com].

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CRS-10
Counter-narcotics cooperation between Thailand the United States is extensive
and pre-dates the foundation of ILEA-Bangkok. Coordination between the U.S. DEA
and Thailand’s law enforcement agencies, in conjunction with a mutual legal
assistance treaty and an extradition treaty, has led to many arrests of international
drug traffickers.
Human Rights Concerns
Some members of Congress and other U.S. officials have criticized Thailand’s
record on human rights. The 2003 State Department Human Rights Report cities
excessive use of force by some members of the police and links these elements to
extra-judicial killings.33 Thailand has neither signed the UN Convention Against
Torture nor joined the International Criminal Court.34 Human rights activists are
particularly critical of Thaksin’s 2003 anti-narcotics campaign, in which an estimated
3,000 suspected drug dealers were killed, according to press reports. There have
been some indications of internal attention to the issue in Thailand; the National
Human Rights Commission, formed in 2000 by a mandate from the 1997 constitution
to protect civil liberties, has called on the government to review suspected abuse by
Thai police.
Concern by international human rights groups regarding abuse of criminal
suspects by Thai police forces has been exacerbated by the crackdown on Muslim
militants in the southern provinces in 2004. Human rights groups have particularly
cited the disappearance of Somchai Neelapaijit, a prominent Muslim human rights
lawyer, in March 2004.35 Some observers have suggested that abuse by the Thai
police has increased and gone unpunished because of Thailand’s cooperation with the
U.S.-led campaign against terrorism, citing a loss of American moral authority due
to the Abu Ghraib prison abuse revelations.36 Reports in December 2004 emerged
that Bangkok was exploring the possibility of creating an Internal Security Act —
similar to those used in Singapore and Malaysia — that would allow the police to
hold suspects indefinitely without charge.37 These developments have led to
increased concern that Thailand is undermining its democratic process and human
rights record.38
33 Thailand Country Report on Human Rights Practices 2003, accessible at
[http://www.state.gov/g/drl/rls/hrrpt/2003/27790.htm].
34 Crispin, Shawn. “Thailand: In the South, an Iron First in a Velvet Glove,” Far Eastern
Economic Review, Aug. 12, 2004.
35 See Human Rights Watch report, at [http://hrw.org/english/docs/2004/03/17/thaila8127.htm].
36 Crispin, Shawn. “Human Rights — Torture in Thailand,” Far Eastern Economic Review,
Aug. 12, 2004.
37 “Deep South : Severe Security Decree Mulled,” The Nation (Bangkok), Dec. 1, 2004.
38 Kessler, Glenn. “Crackdown by Premier Strains Thailand’s Friendship with U.S.,”
Washington Post, Dec. 25, 2004.

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CRS-11
U.S.-Thailand Trade and Economic Relations
1997 Economic Crisis Recovery
Thailand, like many other countries in the region, saw its economy devastated
by the 1997 Asian financial crisis. With loan and policy assistance from the
International Monetary Fund, Thailand has recovered substantially, although other
setbacks such as the Severe Acute Respiratory Syndrome (SARS) outbreak have hurt
its progress. Growth in the past few years has been strong: Thailand saw 6.2% real
GDP growth in 2002, 6.7% in 2003, and is expected to grow on average 7% in 2004-
2005.39 As a major recipient of foreign direct investment, and with merchandise
exports making up over half of its GDP, Thailand’s economy depends heavily on its
trading partners.
Central U.S. Role
Economic relations with the United States are central to Thailand’s outward-
looking economic strategy.40 In 2003, the United States was Thailand’s largest
export market and its third largest supplier of imports, after Japan and the EU.
According to the American Chamber of Commerce, the United States is second only
to Japan in foreign investment in Thailand, with cumulative investment at $20 billion
and over 200,000 Thai nationals on the payrolls.41 Many analysts and policymakers
suggest that the proposed FTA would further deepen economic ties.42
A Protracted Process for U.S.-Thailand FTA Negotiations?
Although studies indicate that a U.S.-Thailand FTA would increase trade and
investment for both countries and yield net benefit for Thailand, negotiations must
address a list of challenging issues to reach a successful conclusion. The agreement
sought by the United States is the most comprehensive of the multiple FTAs
Thailand has attempted; the agenda includes issues such as intellectual property
rights, investment, environment, textiles, telecommunications, agriculture, electronic
commerce, and government procurement.43 Analysts expect market access for sugar,
rice, and trucks to be among the thorniest of the differences between the two sides.
A January 2004 U.S. International Trade Commission ruling set the stage for
imposing tariffs on Thailand shrimp exports to the United States, which could pose
another obstacle to reaching agreement. Further, some sources have speculated that
39 Economist Intelligence Unit — Business Asia.
40 See CRS Report RS21478, Thailand-U.S. Economic Relations: An Overview, by Wayne
M. Morrison.
41 American Chamber of Commerce in Thailand press release, Oct. 22, 2003, available at
[http://www.amchamthailand.org/acct/asp/news.asp?SponsorID=60&NewsID=421].
42 See CRS Report RL32314, U.S.-Thailand Free Trade Agreement Negotiations, by
Raymond J. Ahearn and Wayne M. Morrison.
43 “Ives to Leave USTR to Take Position in Medical Trade Association,” Inside U.S. Trade,
July 16, 2004.

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CRS-12
Thaksin launched the negotiations without consulting adequately with the
bureaucracies in charge of the controversial areas. These factors, combined with an
inexperienced Thai negotiating team, may slow the talks down considerably.44
An Aggressive FTA Strategy
Thailand has been aggressively pursuing FTAs with countries other than the
United States in its campaign to expand trading opportunities. Agreements have
been signed with Bahrain, China, Peru, Australia, and India. Further deals are
possible with Japan, New Zealand, South Korea, Chile, and the European Union
(EU). Thailand has championed ASEAN regionalism, seeing the proposed ASEAN
Free Trade Agreement (AFTA) as a vehicle for investment-driven integration which
will benefit Thailand’s outward-oriented growth strategy.45 Many observers see
Thailand’s pursuit of FTAs as an indication of its shift away from multilateral
approach, such as working through the World Trade Organization (WTO), and
toward a bilateral or regional approach.
Thailand in Asia
Growing Ties with China
Thailand traditionally has enjoyed a stronger relationship with China than have
many other ASEAN countries. After the U.S. withdrawal from Vietnam, Bangkok
pursued a strategic alignment with Beijing in order to contain Vietnamese influence
in neighboring Cambodia. Bangkok restored diplomatic ties with Beijing in 1975,
far before other Southeast Asian nations. Thailand also has no territorial disputes
with China in the South China Sea, unlike Malaysia, Vietnam, and the Philippines.
Thai companies were among the first to explore investment opportunities after the
Chinese economy opened up in the late 1970s, pursuing ventures with China’s state-
run enterprises. The sizeable overseas Chinese population in Thailand assimilated
relatively easily and became a strong presence in the business world, and eventually
in the political arena as well. Thaksin himself is the member of a prominent Sino-
Thai family. As other regional powers tentatively began to explore commercial
relationships with China, investment from Sino-Thai companies flourished in the
1990’s, fueling a rebirth of interest in Chinese language and culture in Thailand.46
Regional observers have also noted a large influx of new, mostly illegal Chinese
migrants from Yunnan province into Thailand to take advantage of economic
opportunities in the Mekong Delta region.
44 “Talks on U.S.-Thai FTA to Kick Off in Hawaii; USTR Sees Drawn-Out Process,” Inside
U.S. Trade, June 25, 2004.
45 Chirathivat, Suthiphand, and Sothitorn Mallikamas, “Thailand’s FTA Strategy: Current
Developments and Future Challenges,” ASEAN Economic Bulletin, vol. 21, no. 1 (Apr.
2004).
46 Vatikiotis, Michael, “Sino Chic: Suddenly, It’s Cool to Be Chinese,” Far Eastern
Economic Review, Jan. 11, 1996.

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CRS-13
Chinese-Thailand political ties have also strengthened, particularly under
Thaksin’s leadership. In early 2003, Bangkok denied visas to a group of Taiwanese
legislators, a decision which Thaksin defended based on Thailand’s close ties to
China.47 The administration came under harsh criticism for the move; an editorial by
the Bangkok Post pointed to Taiwan and Thailand’s close economic relations
(according to the report, Thais represent nearly 40% of the foreign workforce in
Taiwan, and Taiwan is the third largest foreign investor in Thailand) and asserted that
“the government must build the courage to conduct an independent foreign policy,
or prepare to be forever accused of appeasement [to Beijing].”48
Given the simultaneous emphasis on building close relationships with the
United States and China, Thaksin’s foreign policy could be construed as a classic
hedging strategy designed to avoid dominance by any one power. Some analysts
suggest that Bangkok’s embrace of China indicates a slow move away from the Cold
War reliance on the United States, despite enhanced cooperation in the war on
terrorism, and could be an indicator of how Southeast Asia will manage China’s
increasing influence.49
Divergence with U.S. on Burma (Myanmar) Policy
Bangkok’s approach toward Burma has long been seen as conflicting with U.S.
policy; while the United States has pursued strict economic and diplomatic sanctions
against the regime, Thailand has led ASEAN’s “constructive engagement” initiative,
which favors integration and incentives to coax Burma into reform.50 For Thailand,
this policy minimizes the danger of a large-scale military struggle and expands Thai
business opportunities in Burma.
Thailand’s relationship with Burma has grown closer under Thakin’s
administration. During the 1990s, Thailand voiced harsh criticism of the military
junta ruling Burma, particularly its crackdown on the National League for
Democracy, the opposition party led by democratic activist Aung Sun Su Kyi.
Thailand also has chafed at the huge inflow of illegal drugs from Burma. But the
Thaksin government has placed special emphasis on maintaining normal relations
with Burma, even as European countries have tightened sanctions and other
Southeast Asian countries have distanced themselves from Rangoon. In December
2004, Thaksin called the continued detention of Aung Sun Su Kyi “reasonable,”
prompting angry reactions from some congressional leaders and administration
officials.
U.S. congressional focus on Burma has been consistently critical and punitive.
During the 108th Congress, both chambers overwhelmingly passed a bill (H.J.Res.
95, S.J.Res. 36, S.J.Res. 39, P.L. 108-272) that renewed trade sanctions against
47 “Thai Visa Refusal Aids Strains to Ties with Taiwan,” Financial Times, Jan. 22, 2003.
48 Editorial: “Thailand Need Not Kowtow to Anybody,” Bangkok Post, Jan. 22, 2003.
49 Vatikiotis, Michael, “Catching the Dragon’s Tail: China and Southeast Asia in the 21st
Century,” Contemporary Southeast Asia, vol. 25, no. 1 (Apr. 2003).
50 See CRS Report RS20749, Burma-U.S. Relations, by Larry Niksch.

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CRS-14
Burma to express opposition to the anti-democratic regime. Another set of measures
(H.R. 2330, S. 1182, S. 1215, P.L. 108-61) banned imports from Burma, a strategy
to target the assets of the country’s leaders. A third bill (H.R. 4818, Foreign
Operations Appropriations, Section II, Bilateral Assistance) would have provided $7
million to refugees from Burma, particularly those who flee to Thailand. Some
congressional leaders have also criticized Thailand for its treatment of Burmese
refugees and migrant workers. Backed by human rights groups’ reports, some U.S.
lawmakers have leveled charges of arrests and intimidation of Burmese political
activists, as well as the repatriation of Burmese who seek political asylum.51
ASEAN Relations
Thailand’s positive engagement with Burma complements its broader strategy
of strengthening relations with Southeast Asian countries for economic and political
gain. Bangkok has continued to develop strong relations with its Indochina neighbors
through infrastructure assistance and other aid. In turn, Vietnam, Laos, and
Cambodia provide raw materials, cheap manufacturing, and expanding markets for
Thailand. Thaksin has also pursued enhanced relations with Singapore based on a
common interest in liberalizing trade in the region and with the Philippines centered
on a mutual interest in combating terrorism.
Relations with Indonesia and Malaysia are more complex. Tensions grew when
Thaksin claimed that nationals of the two countries are involved in separatist
violence in the south. Bilateral cooperation with Malaysia, predicated on both
economic ties and political cooperation in dealing with border issues in Thailand’s
restive southern provinces, has strengthened under Thaksin. Although Kuala Lumpur
has pursued JI and other militant Islamic groups aggressively, it is aware that the
Malaysian public is largely sympathetic to Thai Muslim complaints of persecution
based on shared ethnic, linguistic, and religious bonds. Bangkok’s accusations of
militant camps located just over the border in Malaysia has further strained bilateral
relations.52
Regional Health Issues
Thailand’s relationship with its neighbors is defined by not only traditional
security concerns but also by a series of transnational public health issues that have
afflicted the region. Thailand was among the earliest and hardest hit by the
HIV/AIDS epidemic in the 1990s, with infection spreading rapidly among the sex
worker industry and adult HIV/AIDS prevalence rates peaking at about 1.5% in 1996.
Rates are now falling, due largely to an extensive prevention campaign focused on
managing risk in the sex industry. Cambodia undertook similar measures, but
51 See Out of Sight, Out of Mind: Thai Policy toward Burmese Refugees and Migrants,
Human Rights Watch Report, released Feb. 2004.
52 “Thai ‘Proof’ of Malaysian Camps,” BBC News Online, Dec. 21, 2004.

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CRS-15
countries such as China and Vietnam are now threatened by equally dangerous
outbreaks, providing another potential arena for regional cooperation.53

In addition to its relative success in curbing the spread of AIDS, Thailand has
also been mostly commended by the international health community for its response
to outbreaks of the Severe Acute Respiratory Syndrome (SARS) and the avian bird
flu. Because of the importance of tourism to Thailand’s economy, government
officials have, by some accounts, been reluctant to admit a public health problem but
are generally effective once determined to address it. In 2003, seven cases and two
deaths from SARS were reported in Thailand, but the kingdom was removed quickly
from the World Health Organization’s list of at-risk countries in 2003 after taking
steps to curb the spread of the virus. The following year, Thailand killed millions of
potentially infected chickens to contain the bird flu outbreak. Despite the measures,
health officials caution that both diseases remain a threat to Thailand and the region.
In September 2004, several Asian countries reported a re-emergence of the bird flu,
including the death of a man in Thailand.54
Upcoming Challenges and Opportunities
in Bilateral Ties
Progress in FTA Negotiations
The first round of preliminary talks to negotiate the terms of a bilateral FTA was
held on June 28-July 2, 2004 and have proceeded slowly. If negotiations for the
bilateral agreement are able to resolve the sensitive issues outlined above, Thailand
would be the third Asia-Pacific country (after Singapore and Australia) to sign a
comprehensive FTA with the United States. A FTA would enhance Thailand’s
position as a key economic as well as security partner, advance President Bush’s
Enterprise for ASEAN Initiative (EAI),55 and encourage Thailand to support the U.S.
agenda in multilateral WTO negotiations. Failure to reach an agreement, however,
would set back these initiatives and may embarrass Prime Minister Thaksin, who has
been a forceful advocate of bolstering relations with the United States.
Military Transformation in Asia-Pacific
The U.S. Department of Defense initiative to transform and re-align the U.S.
military around the globe provides potential opportunities for increased security
cooperation with Thailand. Pentagon planners are breaking with the quantitative
assurance of keeping 100,000 troops on the ground in East Asia in favor of a more
mobile, capability-based force. In the past few years, U.S. military planners have
53 Kiat Ruxrungtham, Tim Brown, and Praphan Phanuphak. “HIV/AIDS in Asia,” The
Lancet, vol. 364, no. 9428 (July 3-9, 2004).
54 “Lethal Bird Flu Reemerges in Four East Asian Countries,” Washington Post, Sept. 15,
2004.
55 The EAI aims to negotiate bilateral trade agreements with the ten ASEAN countries.

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CRS-16
emphasized a “places, not bases” concept in Southeast Asia in which U.S. troops can
temporarily use facilities for operations and training, without maintaining a lengthy
and costly permanent presence. In a State Department press release, a senior Defense
Department official points to current cooperation with Thailand as an example of the
military’s new approach, specifically citing the annual Cobra Gold exercises.56
Direction of War on Terrorism in Southeast Asia
Thailand has demonstrated its commitment to the U.S. campaign to fight
international terrorism in Southeast Asia over the past three years. Future
developments in the regional war on terrorism may take Thailand’s role further. If
violence in the southern provinces continues to escalate, or if links to radical Islamist
networks are revealed, Bangkok and Washington may re-evaluate the scale of the
insurgency, from a purely domestic movement to a more broadly-based effort. Some
analysts have suggested the use of U.S. Special Forces, for example, to help Thai
military and police officers combat the violence.57 If terrorists continue strikes
elsewhere in Southeast Asia, such as the September 2004 bombing at the Australian
embassy in Jakarta, Thailand may expand its cooperation with the United States on
a broader, regional level. Possible avenues for such coordination could include
further integration on intelligence and law enforcement work to target terrorist
operatives and financing.
56 “U.S. to Transform Military in Parallel with Allies — Capabilities Will Be Emphasized
Instead of Numbers of Troops,” State Department Press Releases and Documents. August
16, 2004.
57 Lumbaca, J.C., “Use Special Forces in Thailand’s Troubled South,” Aug. S20, 2004,
published on the online PacNet Newsletter by the Center for Strategic and International
Studies, [http://www.csis.org/pacfor/pac0435A.pdf].

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CRS-17
Table 1. U.S. Assistance to Thailand
FY2002-FY2005
($ in millions)
Program
FY2002
FY2003
FY2004
FY2005
estimate
estimate
Economic Assistance
Child Survival/Health (CSH)
1.0
1.5
0.0
0.0
Development Assistance (DA)
0.8
1.3
0.0
0.0
Peace Corps
1.3
1.8
2.1
2.6
Total Economic Assistance
3.1
4.6
2.1
2.6
Security Assistance
International Narcotics & Law
4.0
3.7
2.0
2.0
Enforcement (INCLE)
International Mil. Education &
1.7
1.8
2.5
2.5
Training (IMET)
Foreign Mil. Sales Financing (FMF)
1.3
2.0
1.0
1.5
Nonproliferation, Anti-Terrorism,
0.7
0.2
0.4
0.8
Demining & Related (NADR)
Total Security Assistance
7.7
7.7
5.9
6.8
Total Economic and Security
10.7
12.2
7.9
10.3
Assistance
Source: Department of State, USAID, U.S. Dept. of Agriculture.

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CRS-18
Figure 1. Map of Thailand
CHINA
VIETNAM
MYANMAR
LAOS
P h i t s anu l ok
N a kh on
S aw an
THAILAND
Ub on
R at c ha th an i
N ak h on
R at ch as i m a
KAMPUCHEA
Andaman Sea
Gul f of Thai l and
P hu k et
H at
P at t an i
Y a i
N ara th i w at
Y a l a
St r ai t of
Sout h Chi na
Mal acca
MALAYSIA
INDONESIA
Sea
Source: Map Resources. Adapted by CRS. (K.Yancey 3/23/04)

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