2 days ago
Farmers fret at tariff deal
Local farmers are gradually voicing their fears about the economy after learning that the Thai government may remove non-tariff barriers and reduce the tariff for imported goods from the United States.
The Thai negotiating team sent to Washington managed to get a tariff rate of 19% on Thai goods exported to the US, instead of the initial 36%.
Let's not forget that the Thai government in the past promised not to sacrifice the local farm sector.
But apparently, their promises back then were just more hot air, as the deal with the US may affect local swine farmers and corn growers.
The government has agreed to reduce the tariff on US imported products to 0% and may remove non-tariff protective measures, such as a ban on pork products with ractopamine additives.
It also promised to invest more in the US and buy American commercial planes, natural gas, and corn.
Recently, Termsak Boonchuen, president of the Nakhon Sawan Farmer Council and a member of the national maize policy and management committee, warned that an influx of the much cheaper genetically modified corn from the US would affect local farmers.
Thailand would need to purchase 3.5 million tonnes of corn from the US for the local feedstock industry, he said.
Sitthiphan Thankiatphinyo, president of the Swine Raisers Association of Thailand, meanwhile, is urging the government to clarify the matter and provide policy help after learning that the ban on ractopamine-fed pork, in place since 2007, may be lifted to accommodate the US tariff deal.
Ractopamine is a feed additive used in some countries, especially the US, to promote leanness, muscle, and protein in pigs and cattle.
Thailand, along with the European Union, Taiwan, and other markets, has banned the import of ractopamine-fed pork, citing potential negative impact on the health of consumers.
What is worrying is that the government does not have answers for local farmers.
This week, Finance Minister Pichai Chunhavachira was quoted by the media as giving vague promises, such as financial assistance, subsidies, and arranging training courses, to improve the capacity of local farmers.
But the fact is that the government has become tight-lipped about its trade negotiations with Washington.
Past experience already shows that free trade agreements and zero-tariff deals often affect local small-scale farmers the most.
For example, an FTA that the Thai government signed with Beijing in 2003 has decimated swaths of local farmers and producers.
While this particular FTA has helped the export of valuable fruit, the 0% tariff policy has opened the door for the import of cheap vegetables and fruit into the local market.
In terms of the local swine industry, the government has failed to deter illegal pork smuggling, causing substandard products to flood the market for the last few years.
Getting a favourable tariff deal from the US is welcome, but it is far from enough.
The government must help local manufacturers to deal with the impact and make Thai farm products more competitive.
