As a developing country, Thailand’s agricultural sector is critically important to its economy. Thailand is considered the eighth largest exporter of agricultural products in the world(42). Agricultural area occupies about 40 percent of the whole country(43), and the majority of the population works in this sector(44).

      Not only does the agricultural sector play an important function as a main source of food supply, but it also efficiently supports a cheap supply of products for enlarging the Thai industrial sector(45). For this reason, industrial products from Thailand are cheaper than those from many countries.

       Moreover, after the establishment of the WTO, agricultural products have played a crucial role in international trade as a significant source of foreign income(46). Before 1995 Thailand faced a trade deficit every year. After joining the WTO, Thailand reduced its deficit by exporting a large number of agricultural products under WTO Agreements. Subsequently, Thailand has had a trade surplus since 1999.

Table 1: Value of Thailand Exports and Imports between 2000-2004

Value (millions of baht)	2000	2001	2002	2003	2004
1. Agricultural exports	626,286	685,148	694,403	804,349	886,147
2. Agricultural imports	275,459	323,123	325,961	363,374	400,282
3. Balance of agricultural exports (1-2)	350,827	362,025	368,442	440,975	485,865
4. Non-agricultural exports	2,141,779	2,199,556	2,229,538	2,521,281	2,988,677
5. Non-agricultural imports	2,218,674	2,429,223	2,448,879	2,775,402	3,400,889
6. Balance of non-agricultural exports (4-5)	-76,875	-229,667	-218,341	-254,121	-412,212
7. Total export	2,768,065	2,884,704	2,923,941	3,325,630	3,874,824
8. Total import	2,494,133	2,752,346	2,774,840	3,138,776	3,801,171
9. Balance of trade (7-8)	273,932	132,358	149,101	186,854	73,653

          As shown in Table 1, the value of non-agricultural exports is the highest amount of the total Thai exports, but the value of its imports completely surpasses the value of non-agricultural exports. However, the balance of agricultural exports can eliminate the trade deficit in non-agricultural exports, and thus create a balance of trade surplus. Hence, the balance of agricultural exports plays a key role in the Thai economy and supports the population’s standard of living.