Thai businesses are urging the government to enhance measures to protect local producers from a potential surge of low-cost goods in light of the new tariffs on Chinese imports imposed by the United States.
Kriengkrai Thiennukul, chairman of the Federation of Thai Industries, indicated during a briefing in Bangkok on Wednesday that if Prime Minister Paetongtarn Shinawatra’s administration does not take action, the number of industries affected by cheap imports could rise from 23 to 30 compared to last year.
Currently, industries severely impacted by the influx of imports include steel, plastics, electrical appliances, and clothing. The call for increased protective measures comes as concerns grow that Chinese exporters may redirect surplus products to neighboring countries, unable to ship them to the U.S. Additionally, Thai officials are preparing to mitigate any punitive tariffs on exports to the U.S., with which Thailand reported a trade surplus of $35 billion last year.
Continued imports of inexpensive products pose a further threat to Thailand’s manufacturing sector, which has seen average factory capacity utilization drop to about 56%. Thailand’s industrial output has declined for five consecutive months, with automobile sales plummeting amid weak demand.
The Joint Standing Committee on Commerce, Industry, and Banking has also recommended that the government include representatives in a “war room” to quickly strategize responses to U.S. President Donald Trump’s trade policies.
Mr. Kriengkrai suggested that the government consider hiring lobbyists to engage with the U.S. and also seek partnerships with China to develop joint ventures for manufacturing products, thereby circumventing U.S. restrictions.
Thai officials have stated they will provide incentives to foreign companies looking to lessen the impact of the U.S.-China trade conflict. Commerce Minister Pichai Naripthaphan is currently in the U.S. and is expected to meet with American trade representatives to alleviate tensions.
The business group has maintained its economic growth forecast of 2.4% to 2.9% for this year, acknowledging that Southeast Asia’s second-largest economy is facing various challenges, including an escalating trade war and a strong domestic currency.
