Bangkok: The Exporters' Council anticipates robust export performance in the second quarter of 2025, driven by the United States' continued acceleration of goods imports during the relaxation of the Reciprocal Tariff. In the second half of the year, attention will turn to the United States as it negotiates with trading partners to establish a joint solution, potentially resulting in a 10% Reciprocal Tariff. The involvement of the Prime Minister is deemed crucial, as a joint working group comprising government and private sectors prepares to address new trade models.
According to Thai News Agency, Mr. Thanakorn Kaset Suwan, Chairman of the Thai National Shippers' Council (TNSC) or the Exporters' Council, reported a 15.2% expansion in exports during the first quarter of 2025, valued at $81,532.3 million or 2,757,249 million baht. This growth was attributed to the United States' expedited orders and production to circumvent retaliatory measures. Mr. Thanakorn expects Thai exports to remain strong in the second quarter, with the US maintaining its import pace during the Reciprocal Tariff's relaxation. However, the second half of the year will require vigilance regarding President Donald Trump's evolving tariff policies, with the Exporters' Council predicting eventual negotiations and a likely 10% Reciprocal Tariff.
The Council urges the government to promptly establish a working group to adapt to the new trade patterns introduced by the Reciprocal Tariff and develop a long-term strategy. This initiative should be led by the Prime Minister and supported by various government ministries, such as Finance, Commerce, Industry, and Foreign Affairs, along with private sector bodies like the Thai Bankers Association, the Thai Chamber of Commerce, the Federation of Thai Industries, and the Thai National Shippers' Council. The group will strategize for each product category and trading partner, factoring in the changing trade and investment dynamics influenced by import tariff policies. Emphasis will be placed on diversifying risks and seizing opportunities within cooperative frameworks like ASEAN-US, ASEAN-Europe, ASEAN-China, ASEAN-Japan, ASEAN-Korea, and ASEAN-India. Additionally, the Council advises that negotiations with the US should differentiate between the export value of US-invested manufactured products and the import of essential capital goods from the US.
Mr. Thanakorn emphasized the necessity for Thailand to develop long-term strategies, noting that China has established a production base for exporting to the US, resulting in high export figures, although Thailand's actual production remains low. Furthermore, many factories enjoy BOI privileges, leading to an absence of tax revenue from foreign factories for the first eight years. Thai entrepreneurs are also impacted by price reductions. Consequently, long-term planning is imperative, including the urgent identification of new markets and the establishment of new cooperation frameworks to enhance export opportunities and channels.
The Exporters Council also calls on the government and relevant agencies to monitor the influx of products from countries impacted by the Reciprocal Tariff, as they may flood into Thailand and compete in the global market, particularly in sectors such as electronics, toys, automotive parts, air conditioners, audio equipment, household appliances, tableware, plastic products, furniture, textiles, leather goods, and more. China, exporting a significant portion to the US, needs alternative markets. The Council proposes measures to curb imports and domestic production investments, including:
1. Measures to prevent low-quality product imports:
- Supervision of products and factories from the country of origin, ensuring Thai standards certification, clear product labeling, and transparent exporter identification on E-Commerce Platforms. Products destined for Thailand must be notified 24 hours prior to departure from the port of origin to facilitate effective inspection.
- Enhanced inspection rigor within Thailand, including 100% inspection of imported products to block low-quality entries, thorough scrutiny of Free Zone products to prevent fraudulent export rights and non-compliant products, and strengthened consumer protection against substandard imports.
2. Measures to counter zero-dollar investment:
- Review of investment promotion benefits under the BOI for new investments.
- Establishment of joint venture conditions for investment promotion benefits, such as requiring Thai majority ownership, mandatory technology transfer agreements for foreign joint ventures, and a requirement that promoted businesses employ at least 50% Thai workers.
3. Measures to promote international trade:
- Increased budget allocation for "organizing trade promotion activities abroad" and "marketing support for the private sector," such as the SME Proactive program.