Thailand, which depends heavily on trade, has proposed the Trump administration a framework of suggestion to begin official negotiations to prevent a 36% tariff on its imports.
Thailand hopes its recent efforts to stop the misuse of origin laws for exports will reduce its trade deficit with the United States (US) by as much as $15 billion annually, as per Finance Minister Pichai Chunhavajira.
At an American Chamber of Commerce conference in Bangkok on Tuesday, Pichai stated that the government will implement many anti-trade circumvention laws to ensure that Thailand establishes a long-term fair and balanced trade and investment partnership with the United States.
The minister did not specify when they would achieve the expected reduction, but such a cut would almost eliminate one-third of Thailand’s outstanding $46 billion trade surplus with Washington from the previous year.
With US President Donald Trump‘s tariffs, Thailand, the second-largest economy in Southeast Asia, is likely to be among the most severely affected. If they do not achieve a reduction before Trump’s pause in implementing the reciprocal tariff policy, which ends in July, they will be subjected to a 36% US import tax.
The United States was Thailand’s biggest export destination with $55 billion in shipments last year. Washington estimates a $45.6 billion bilateral trade deficit with Thailand.
Thailand, which depends heavily on trade, has proposed the Trump administration a framework of suggestion to begin official negotiations to prevent a 36% tariff on its imports.
According to Pichai, both countries can benefit from the Thai offerings, which include steps to tackle trade rerouting by Chinese companies, lowering tariffs and non-tariff barriers, and increasing investment.
Pichai assigned an individual to lead the Thai delegation for discussion with US officials. He confirms that he is confident that they have a strong set of practical proposals that can lead to win-win situations and deliver tangible wins.
Thailand is pushing for a trade agreement with the US to lessen the impact on its economy after a series of growth forecast cuts from the World Bank and the central bank. About 18% of its total shipments last year came from the US, making it the largest export market.
The country’s trade minister stated that it may exceed its export growth goals this year, but the challenges remain as it attempts to achieve a mutually beneficial agreement with the United States.
According to Pichai, exports will either reach or surpass their goals, even though there might be bumps along the way.
According to government forecasts, the exports will increase by 2% to 3% this year.
Pichai commented after March’s export growth reached a three-year high of 17.8%. The exports grew 15.2% in the first quarter.
Thailand announced that it will increase scrutiny of new investment proposals to guarantee that “essential production process” happens in the country and suspend investments in some industries that pose concerns of overstock or have adverse environmental effects. It also simplified the “certificate of origin” issuance process and added more industrial goods to the watchlist.
According to Pichai, the country is exploring more investments by private companies in America. They can see more partnerships in energy, digital technology, infrastructure, wellness tourism, and the creative industries.
He stated that they are trying to strategize by negotiating about Thailand and the United States’ common interests, such as energy and pet food, and increasing US imports, including liquefied natural gas (LNG).
After leading the private sector leaders’ delegation to the United States last week, Nalinee Taveesin, president of Thailand Trade Representatives, stated that Thai companies will spend at least $2 billion in the United States.
The Southeast Asian country also stated it is interested in joining the gas pipeline project in Alaska, supported by President Donald Trump.
