Proposal to reduce tariffs and boost U.S. trade to be submitted Friday
Thailand held critical trade discussions with the United States on Wednesday, aiming to avoid a steep 36% tariff rate threatened by Washington. Thai officials confirmed that a formal proposal will be submitted Friday, just weeks ahead of the July 9 deadline when the current 90-day tariff pause expires. Without a deal, most Thai goods could face sharply higher duties.
According to Commerce Ministry Permanent-Secretary Vuttikrai Leewiraphan, the U.S. outlined five key concerns: tariffs and quotas, non-tariff barriers, digital trade, origin of goods, and economic-security issues. Thailand’s upcoming proposal includes reduced tariffs, increased U.S. imports, and expanded investments to address these points.
Industrial sentiment weakens despite strong export growth
Concerns over trade tensions have pushed industrial sentiment in Thailand to an eight-month low, data from the Federation of Thai Industries showed. Still, Thailand’s export performance remains resilient. May exports surged 18.4% year over year to a record $31 billion, far surpassing the 6.7% gain forecast in a Reuters poll.
Shipments to the U.S. jumped 35%, reflecting front-loading ahead of potential tariffs, while exports to China rose 28%. Overall exports increased 14.9% during the first five months of 2025 compared to a year earlier. Commerce Minister Pichai Naripthaphan expressed confidence that annual export growth will exceed 10%, citing a weaker Thai baht as a tailwind.
Electronics, agriculture drive trade momentum
Thailand’s computer and parts exports surged 104% in May, while agricultural shipments rose 6.8%. Rice export volumes, however, edged down 0.2%. Imports rose 18%, outpacing the expected 13.1% increase, resulting in a trade surplus of $1.12 billion for the month.
Pichai said he remains optimistic about securing favorable terms with the U.S., potentially limiting tariffs to 10%. He also noted the trade sector would be the “hero” of the economy this year, with continued negotiations likely even beyond the July deadline if needed.