Thailand remains hopeful of negotiating a lower tariff rate than the 36% duty announced by US President Donald Trump, based on proposals to reduce import taxes on most US goods to zero, according to Finance Minister Pichai Chunhavajira.
The Southeast Asian country anticipates concluding trade talks before the US-imposed August 1 deadline, Mr. Pichai told a local TV station on Tuesday. He noted that the US has disregarded Thailand’s revised proposals to enhance market access by removing tariffs and non-tariff barriers on various products.
In a last-minute effort to avoid the steep tariffs, Thailand submitted a revised proposal to the US on Sunday, aiming to increase bilateral trade and reduce its $46 billion trade surplus by 70% over five years. The proposal included increased access for US agricultural and industrial goods, as well as greater imports of energy and Boeing aircraft.
Mr. Pichai described Thailand’s latest offer as “a good deal for the US,” stating that Thailand would lower tariffs on 90% of US products. He also expressed some surprise at the tariff being maintained at 36%, despite the revised proposal.
Last year, the US was Thailand’s largest export market, accounting for around 18% of its total shipments. Thai exports surged approximately 15% in the first five months of this year, driven by front-loading orders following a 90-day pause on high tariffs proposed by the Trump administration.
Securing a lower US tariff is crucial for protecting Thailand’s trade-reliant economy from further declines. Growth is already under pressure due to Southeast Asia’s highest household debt levels and sluggish domestic consumption. Officials estimate that the 36% tariff could reduce Thailand’s GDP by at least one percentage point this year.
Investor confidence has also been impacted by political instability following the court-ordered suspension of Prime Minister Paetongtarn Shinawatra over allegations of ethical misconduct related to a border dispute with Cambodia.
