Thai business leaders are raising urgent concerns over the potential imposition of trade tariffs by the United States, calling on the Thai government to take swift action to counter the looming threat. The Thai Chamber of Commerce (TCC) has warned that failure to address the situation could severely impact the country’s economy, with potential losses estimated at 100 to 150 billion baht, a reduction in GDP by 0.5 to 0.7 percent, and a failure to meet the government’s 3.5 percent growth target.
With the April deadline approaching, the TCC is urging the government to establish a special task force, led by the Prime Minister, to counter the threat of rising tariffs. This task force, according to the TCC, should include representatives from both the public and private sectors to develop a strategic response to the possible resurgence of protectionist policies under the Biden administration.
The core of the concern lies in the growing trade surplus between Thailand and the United States. The increasing imbalance in favor of Thailand has led to fears that the US may impose punitive tariffs to reduce its deficit. According to the Joint Public and Private Sector Consultative Committee (JPPSCC), the situation warrants immediate attention, but so far, the government has not responded with a formal plan.
Sanan Angubolkul, chairman of the TCC and the Board of Trade, expressed deep unease over the potential economic fallout, particularly within key sectors such as electronics, automobiles, and agricultural products. He warned that Thailand could face shifting market dynamics, with ASEAN nations and Thailand becoming even more critical for industries like electrical appliances, industrial goods, and food products.
Sanan also called for stricter controls on imports, especially low-quality goods that may harm fair competition. The TCC is advocating for tighter regulations on import standards, mandatory certifications, and verification of product origins to combat counterfeit products and tax evasion. Additionally, the business body is demanding enhanced enforcement against predatory pricing and dumping practices.
Poj Aramwattananont, vice chairman of the TCC, emphasized the need for a more balanced trade relationship with the US. He suggested increasing imports from the US, particularly in sectors like agriculture, food, and energy, to help address the trade deficit. Reforming Thailand’s import tariff quotas with the US was also proposed as a way to strengthen the nation’s negotiating position in future trade talks.
Moreover, Poj called for a comprehensive review of the service sector trade deficit, which includes digital services, management fees, copyrights, and other intangible goods. This, he argued, would provide a fuller picture of Thailand’s economic relations with the US.
To address these challenges, the TCC has reiterated its demand for the establishment of a task force led by the Prime Minister, coordinating with key ministries such as Foreign Affairs, Commerce, Agriculture, Industry, Digital Economy, and Labour. The team would also collaborate with the Thai Chamber of Commerce and the Federation of Thai Industries (FTI) to draft a proactive negotiation strategy.
In addition to addressing trade imbalances, Poj has recommended increasing US import quotas for critical goods like feed corn, soybeans, beef, and seafood. This, he believes, would help ease trade tensions and improve Thailand’s leverage in future discussions.
Thanavath Phonvichai, president of the University of the Thai Chamber of Commerce, warned that failure to act swiftly could result in serious economic repercussions. He predicted that Thailand’s economic growth could fall below 3 percent in 2025, well short of the government’s target.
Thanavath also highlighted the indirect effects of US tariffs on Thailand’s trade with Canada, Mexico, and China, estimating potential losses of 20 to 25 billion baht and a 0.1 to 0.5 percent reduction in GDP. Furthermore, tariffs on automobiles could lead to a loss of up to 65 billion baht, reducing GDP by an additional 0.35 to 0.4 percent.
With the US remaining Thailand’s largest export market in 2023, the growing trade surplus, which amounted to $29.045 billion, is increasingly seen as a potential trigger for US trade action. Preliminary data for 2024 suggests Thailand’s surplus with the US has expanded to approximately $45.6 billion, further elevating concerns over the future of trade relations between the two countries.
As the situation develops, business leaders are calling for decisive government action to safeguard Thailand’s economic stability and protect key industries from the potential fallout of US trade measures.
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