Bangkok: “Kobsak” has assessed that Thailand’s exports and agriculture can continue to thrive even if the country faces a 25% tariff imposed by the Trump administration. He remains optimistic that Thailand can negotiate favorable terms and highlighted that the stock market still holds potential despite current challenges. Notably, the baht is strengthening alongside a weakening dollar.
According to Thai News Agency, Mr. Kobsak Pootrakool, Senior Executive Vice President and Company Secretary of Bangkok Bank Public Company Limited and Chairman of the Federation of Thai Capital Market Organizations (FETCO), expressed concerns about the impending US retaliatory tariffs during a lecture on the 2025 Senior Economic Reporter Capacity Development Project. With only six days left until the August 1 deadline, he warned of severe repercussions if Thailand is taxed at a 36% rate, particularly for the export sector, which constitutes 60% of the country’s exports. Such a scenario could have long-term impacts on Thailand’s income. Regional competitors like Indonesia, Vietnam, and Japan have already secured deals with tariffs of 15-20%, affecting Thailand’s trade competitiveness and attractiveness to investors.
Kobsak noted that a 25% tariff, although 5% higher than those of other countries, is something the Thai private sector can accommodate. He emphasized that the private sector can adapt and safeguard the agricultural sector, ensuring the continuation of exports in the long run, despite some challenges to certain agricultural industries.
The Thai government has allocated a 50 billion baht budget to mitigate the impact of US tariffs on exporters, which Kobsak considers sufficient. However, he expressed concerns about the adequacy of the 200 billion baht budget for low-interest loan measures intended to support the agricultural sector, suggesting the government explore better alternatives.
Board of Investment (BOI) data reveals that foreign direct investment (FDI) requests exceeded 1 trillion baht in the first half of the year, matching the total request value for 2024. Investment decisions now hinge on US tariffs. If Thailand’s tariffs align closely with those of other regional countries, investors may proceed with their plans as per the BOI’s request.
Kobsak remains hopeful about the stock market as the announcement of tax figures approaches. Recent rebounds in the market, influenced by Japan’s successful negotiations, provide optimism. Simultaneously, Thailand is advancing new negotiations with the United States. However, uncertainty persists until the US announces its decision, and the market remains cautious as the August 1 deadline looms.
Kobsak also discussed the baht’s strengthening trend over the past four years, attributing it to the weakening dollar, which has seen a significant decline from an index value of 110 to 97-96. As a result, the baht has appreciated from 35-36 baht/dollar to 32 baht/dollar, attracting investors to alternative assets like gold, Bitcoin, and currencies such as the Euro and the Yen.
He speculated that the US might pursue a policy to further weaken the dollar, potentially posing challenges for Thailand by exacerbating the baht’s appreciation, impacting the export, tourism, and investment sectors.