Export value could take B200bn hit
Thanavath Phonvichai, president of the UTCC, said Thailand still has a chance to negotiate a more favourable tariff rate with the US, potentially down to 20%, in line with Vietnam's rate, before the tariffs are implemented on Aug 1. However, reaching a tariff agreement remains uncertain.
Moreover, if there is political unrest later this year such as a parliamentary dissolution and the government is unable to allocate the economic stimulus budget, GDP growth could be reduced by one percentage point. This scenario could lead to overall economic growth of less than 1% for the year, which is lower than the previous projection of 1.7%.
He said that if the 25-36% tariffs remain in place for one year, it will affect about 400-600 billion baht in exports.
The UTCC also revealed the consumer confidence index for June, which fell to 52.7, a 28-month low, with expectations for further declines until the end of the year.
Mr Thanavath said this decrease was attributed to concerns about the stability of the Thai government, ongoing political uncertainty, and the US trade war.
Despite the government's implementation of economic stimulus measures and the Bank of Thailand's decision to lower the policy interest rate to 1.75%, consumers still perceive the economic recovery as sluggish, especially as they find it difficult to access credit.
In terms of business sentiment, the June survey of chamber members showed a fourth straight month of decline, reaching the lowest level in 30 months at 46.7.
Businesses expressed concerns over domestic political issues, US trade barriers, a slow tourism recovery, and broader economic vulnerabilities.
The employment level index has dropped below 40, indicating a decline in labour market confidence.
The business community is urging the government to fast-track economic stimulus initiatives, push for tariff negotiations with the US to lower rates to below 36%, improve credit access, and take preventive measures to address issues at the Thai-Cambodian border.
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