BANGKOK — US President Donald Trump’s announcement of a 36% tariff on Thai imports has sent shockwaves through Thailand’s export sector, prompting urgent calls for government intervention to protect the country’s $65 billion trade relationship with America.
The tariff, far higher than expected, threatens to devastate Thailand’s competitiveness in the US market. Electronics, processed food, rice, rubber products, and consumer goods face the greatest risk from the new trade barriers.
Thanakorn Kasetsuwan, chairman of the Thai National Shippers’ Council (TNSC), warned the impact could extend beyond exporters to trigger widespread layoffs, reduced foreign investment, and economic slowdown. Agricultural sectors may see domestic crop prices plummet as export channels dry up, directly hurting farmers and rural communities.
Three-Point Action Plan
The TNSC has prepared comprehensive policy proposals for Thailand’s Prime Minister, Finance Minister, and Trade Minister, focusing on three key areas:
Tariff Reduction Negotiations: Thailand should eliminate import tariffs on US goods wherever possible, extend investment privileges for American companies, and increase energy purchases from the US to replace other suppliers.
Market Diversification: The government should allocate 2026-2027 budgets for trade promotion activities, including overseas trade fairs, business matching events, and trade missions. Small and medium enterprises need expanded support to access new export markets.
Economic Support Measures: Urgent discussions with the Bank of Thailand on interest rate cuts, exchange rate policies to keep the baht competitive, and postponing minimum wage increases. The government should also reduce electricity, fuel, and logistics costs for exporters while speeding up VAT refunds and allowing 200% deductions for international shipping costs.
Business groups are pushing for streamlined export procedures, full digitization of trade processes, and stronger enforcement against substandard imports. They want 100% inspections of imported goods and stricter verification requirements for foreign sellers on e-commerce platforms.
Survey Reveals Broader Economic Concerns
The Thai-Chinese Chamber of Commerce’s Q3 2025 Business Confidence Index, based on surveys of 480 business leaders, shows 52% expect Thailand’s GDP growth to slow to just 1.5-1.8% this year due to Trump’s tariff policies.
The automotive, processed food, tourism, electronics, steel, and energy sectors are expected to face the heaviest impact. Survey respondents identified three critical risks: declining Chinese tourist arrivals through 2025, potential flooding of Thai markets with Chinese goods diverted from the US, and the risk of Thailand being targeted if China uses it to circumvent tariffs.
Trade Deficit with China Grows
Despite the US tariff concerns, Thai-Chinese bilateral trade grew 18.69% in the first five months of 2025, reaching 1.953 trillion baht. However, this growth came with a significant trade imbalance—while Thai exports to China increased 10.45%, imports from China surged 22.52%, creating a 799 billion baht trade deficit.
The Thai-Chinese Chamber recommends urgent tourism promotion measures and accelerated development of new export markets to cushion the economic downturn ahead.
Government Mobilizes High-Level Response
Meanwhile, Thailand’s major business organizations have been coordinating their response. On July 8, the Thai Chamber of Commerce, Federation of Thai Industries, Thai National Shippers’ Council, and financial associations convened emergency meetings to assess the potential impact if the 36% tariff takes effect on August 1, or if additional measures are imposed.
All sectors agreed that the 36% rate, combined with a weakening baht and intensifying global trade competition, would severely pressure Thai exports from late 2025 onward and could trigger production base relocations. Some business groups have requested the government reconsider planned minimum wage increases and expand double tax deductions for companies facing losses or significantly reduced revenues.
This Friday, July 11, Thailand’s negotiating team and all relevant ministers are scheduled to meet at Ban Phitsanulok. Finance Minister Pichai Chunhavajira, who leads the negotiating team, expressed optimism that Thailand could still secure a win-win deal with the United States before the August 1 deadline.
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