Thailand offers zero tariffs on US goods in new trade proposal
The move aims to prevent the US from imposing a 36% levy on Thai goods after a temporary 10% cap expires on July 9.
Finance Minister Pichai Chunhavajira confirmed the updated proposal, which includes commitments to increase imports of US products and achieve trade balance within a decade.
The US is Thailand's largest export market, accounting for 18.3% of shipments worth $54.96 billion in 2023.
However, Washington reported a $45.6 billion trade deficit with Thailand, prompting threats of higher tariffs if negotiations fail.
Pichai stated that the new proposal addresses US concerns while protecting Thai interests.
'We adjusted the proposal based on their feedback, focusing on areas of mutual benefit,' Pichai said.
'We are offering zero tariffs on a substantial number of items, though not across the board.' The US Trade Representative acknowledged Thailand's efforts but suggested minor refinements.
Key Thai exports to the US include computers, telecommunication equipment, and rubber products, while major imports from the US are crude oil, machinery, and chemicals.
Pichai highlighted plans to boost imports of US natural gas and reduce tariffs on American corn, currently taxed at 73%.
In June, Thailand's PTT Group signed a 20-year deal to purchase 2 million metric tons of liquefied natural gas annually from the Alaska LNG project, a $44 billion initiative supported by former US President Donald Trump.
Thailand's economy faces challenges, including weak consumption, rising debt, and trade uncertainties.
The central bank projects 2.3% growth in 2024, down from 2.5% last year. Pichai warned that US tariffs could further limit growth to just over 1%.
Trade discussions are expected to continue beyond the tariff pause, as negotiations involve multiple stakeholders. 'It's not just about tariffs but expanding trade opportunities,' Pichai added. - Reuters
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