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Bangkok Post
05-08-2025
- Business
- Bangkok Post
Tariff to reduce 2026 exports by B275bn
Thai exports are projected to dip by roughly 275 billion baht in value next year, or 1.48% of GDP as a result of the US's 19% reciprocal tariff, according to the University of the Thai Chamber of Commerce (UTCC). Thanavath Phonvichai, president of the UTCC, said the US tariff policy is projected to impact Thailand's exports by 115 billion baht over the next five months, potentially leading to a GDP contraction of 0.62 percentage points. This projection includes an estimated loss of 107 billion baht from the tariff hike, with an indirect impact via global supply chains causing a loss of 27 billion baht. Meanwhile, Thailand could gain 18.9 billion baht from trade diversion, according to the UTCC. The university maintained its GDP growth projection at 1.5-2%, with a midpoint of 1.7%. For next year, export revenue losses are projected to reach 275 billion baht, accounting for 1.48% of GDP. This figure includes an estimated direct loss of 256 billion baht due to tariff increases, and a negative indirect impact via global supply chains of 64.7 billion baht. The possible gain from trade diversion is estimated at 45.3 billion baht. The UTCC's study identified sectors particularly vulnerable to the tariff as electrical and electronic equipment, machinery and parts, and rubber products, primarily due to their substantial market share in the US and their dependence on that market. However, a comparison of Thailand's top 10 exports to the US reveals it is not at a significant disadvantage to competitors, as it faces similar tariff levels to those of Malaysia, Indonesia, the Philippines and Cambodia. Regional countries enjoying lower tariffs than Thailand include Singapore at 10%, and Japan and South Korea at 15%. This tariff difference gives them an advantage for advanced integrated circuit boards, advanced chemical products, advanced semiconductors, advanced machinery and industrial equipment. Nations facing steeper tariffs than Thailand are Vietnam, Taiwan, Sri Lanka and Bangladesh at 20%, India and Brunei at 25%, Laos and Myanmar at 40% and China at 51%. This tariff gap offers an opportunity for Thailand to expand its share in the US market in sectors such as electrical equipment, electronics, machinery, computers, furniture and miscellaneous goods, according to UTCC. To address these challenges, the university proposed six policy recommendations for the government: providing support for affected industries; enhancing enforcement of rules of origin; diversifying export markets; attracting high-value foreign direct investment; stimulating domestic demand; and engaging in proactive trade diplomacy to support the country's economic growth. The UTCC also conducted a poll on Mother's Day spending, estimating 11 billion baht this year, growth of 1.9% year-on-year.
Bangkok Post
09-07-2025
- Business
- Bangkok Post
Export value could take B200bn hit
Thailand is expected to lose roughly 200 billion baht in export value this year if the US imposes tariff rates of 25-36% on Thai products, according to the University of the Thai Chamber of Commerce (UTCC). 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.
The Star
27-06-2025
- Business
- The Star
Thai GDP forecast cut to 1.7% amid multiple crises and political uncertainty
BANGKOK: The Centre for Economic and Business Forecasting (CEBF) at the University of the Thai Chamber of Commerce (UTCC) has revised Thailand's GDP growth forecast for 2025 down from 3% to 1.7%, citing a combination of global and domestic challenges weighing on the economy in the second half of the year. Thanawat Pholvichai, President of UTCC and the centre's chief adviser, outlined a string of mounting concerns: the ongoing trade war and potential US tariffs on Thai goods, the Israel-Iran conflict, rising tensions along the Thai-Cambodian border, domestic political instability, and the effectiveness of the government's stimulus disbursement. The revised forecast assumes no further escalation in any of these risk areas. The outlook hinges on the US imposing only 10–15% tariffs on Thai products — with negotiations now entering the final 10 days before the July 8 deadline. It also assumes a quick de-escalation of both the Middle East conflict and Thai-Cambodian border issues, and that Prime Minister Paetongtarn Shinawatra remains in office throughout 2025, enabling 50% of the national budget to be disbursed. Export growth is still expected to come in at +2.5%. - The Nation/ANN
