Bangkok: The Ministry of Commerce is fast-tracking its efforts to support Deputy Prime Minister Pichai Chunhavajira in negotiations with the United States ahead of the looming 36% tariff deadline.
According to Thai News Agency, Deputy Minister of Commerce Mr. Chantavit Tanthasit disclosed that the ministry is swiftly analyzing the impact of the ‘Trump tariff’ to aid ‘Team Thailand’ in its discussions with the US. The ministry is optimistic that its proposal to open the market with a tariff rate ranging from ‘almost 0% to 0%’, applicable to over 90% of the product list, will be favorably received. A significant challenge lies in developing the Regional Value Content (RVC) criteria to align with new US conditions, while ensuring China is not excluded from Thailand’s production system. Mr. Chantavit assured that the proposal would be finalized soon, ahead of the August 1 deadline.
Mr. Chantavit further elaborated that the Ministry is concentrating on three primary missions: compiling product data and exploring market opportunities, evaluating impacts and formulating negotiation strategies, and devising support measures like relocating supply chains, identifying new markets, and assisting affected entrepreneurs. This information was shared during a meeting with Deputy Prime Minister Pichai Chunhavajira, who leads the ‘Team Thailand’ negotiation team.
Thailand’s second proposal for the US import market, submitted on July 6, suggested a tariff rate of ‘almost 0% to 0%’ covering over 90% of approximately 10,000 items. The proposal is currently awaiting an official response from the US. The impact on the remaining 10%, particularly sensitive groups like agriculture and SMEs, is under careful assessment.
The Ministry is also focusing on developing criteria for calculating ‘domestic value’ or RVC, essential for measuring domestic production value in line with new US requirements. The criteria involve separating production value into three parts: Made in Thailand, Made in the USA, and Made in an allied or third country. A credible RVC system will enhance the reliability of data on domestic production, vital for future negotiations. The Ministry anticipates further discussions with the US soon.
Mr. Chantavit highlighted the importance of establishing clear, practical rules to quantify product origins from Thailand, the US, or other countries, forming a negotiation basis. Without this data, Thailand risks being disadvantaged in talks.
Thai entrepreneurs have shown cooperation by providing sensitive data on raw materials and production processes, which the Ministry values as a significant sacrifice for national benefit. Such transparency is deemed crucial for equipping the negotiation team with comprehensive information.
Despite US expectations for Thailand to lessen China’s involvement in its production chain, Mr. Chantavit reiterated that Thailand would not completely exclude China, which remains a key raw material source. The approach will focus on maintaining a balanced stance without bias.
On July 15, US Ambassador to Thailand, Mr. Robert F. Godec, met with Thai Commerce Minister Mr. Chatuporn Buruspat, Deputy Ministers Mr. Suchart Chomklin and Mr. Chantavit Tantasith, alongside senior ministry executives. They discussed trade views and promoted initiatives to adjust the trade balance, aiming to fortify long-term economic ties between Thailand and the United States.