Thailand's Finance Minister Pichai Chunhavajira announced the expansion of the zero-tariff list for select products imported from the U.S. as part of efforts to enhance trade ties.
New Tariff Policy
Thailand has added several items to its zero-tariff list for U.S. goods. Minister of Finance Pichai Chunhavajira explained that excluding more U.S. imports from levies is aimed at opening up trade between the two countries. Additionally, Thailand has reduced tariffs on 90% of its U.S. exports to persuade American counterparts to reconsider the existing 36% tariff on Thai imports.
Impact on Thailand's Economy
Chunhavajira noted that high tariffs could limit Thailand's economic growth this year to just 1%, down from the previously planned 2.3%. Vulnerable sectors include consumer goods, electronics, processed foods, rubber, and rice. The potential drop in agricultural incomes could also increase pressure on rural economies.
Future Trade Negotiations
The Minister stated that feedback from U.S. trade representatives influenced the revised tariff proposal aimed at balancing trade with the U.S. within 10 years. However, concerns linger that if the 36% tariff threat remains, foreign investments might shift to lower-cost countries. Chunhavajira emphasized the importance of continuing negotiations between the two countries after the 90-day tariff pause ends.
In summary, Thailand's new initiatives are designed to alleviate the effects of high U.S. tariffs and improve trade relations while focusing on protecting local producers.
