Tariffs part of power struggle
According to a senior source at the Finance Ministry who requested anonymity, Washington is pressing Thailand to eliminate tariffs on US goods, matching the rate applied to Chinese imports under the Asean-China free trade agreement.
"The US's demand for Thailand to reduce import tariffs to 0%, including on agricultural products and meat such as pork, could be seen as having a negative impact on domestic producers. On the other hand, US products are more expensive than Thai products, so it will ultimately be up to consumers to decide," said the source.
Finance Minister Pichai Chunhavajira convened a meeting with the Joint Standing Committee on Commerce, Industry and Banking on Wednesday to discuss measures to mitigate the impact of potential US tariffs.
Speaking after the meeting, Mr Pichai said the government is preparing measures to cushion the impact on each product group from US President Donald Trump's tariffs.
"We must prepare solutions for the possible outcomes, whether they are favourable or moderately favourable. We need to assess who will be affected," he said, adding the negotiation process is continuing ahead of the Aug 1 deadline.
Mr Pichai said previously the government broadly assessed how the US tariffs would impact exporters. However, this time the assessment is more detailed as the tariffs vary depending on the product type and its local content.
The private sector plans to gradually submit impact data for Mr Pichai's review by Friday.
Poj Aramwattananont, chairman of the Thai Chamber of Commerce, said the impact of the Trump tariffs on each product exported to the US varies, depending on the level of local content in each item. The proportion of local content the US will require is still unclear, he said.
Mr Poj also expressed concern that tariff negotiations with the US may not be resolved soon, which could result in the US maintaining its proposed 36% tariff on Thai goods, which many analysts in Thailand consider excessively high.
"We hope the US will impose a lower tariff rate on Thai products than on Vietnamese products, as Thailand's trade surplus with the US is much smaller," he said.
Vietnam has a trade surplus with the US of US$120 billion a year, while Thailand's surplus is only $40 billion.
According to the Finance Ministry source, Mr Pichai will chair a meeting today with economic ministers and the prime minister's advisors to discuss measures to address the tariff impacts.
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