Bangkok: Economists from the University of the Thai Chamber of Commerce have advised the Thai government to negotiate a reduction in US tariffs to below 30%, amid concerns about competition with Chinese products. According to Thai News Agency, China and the United States have agreed to a temporary reduction of tariffs by 115% for 90 days, which is expected to positively impact the global economy.
Dr. Anusorn Thamjai, Dean of the Faculty of Economics and Director of the Center for Research on Digital Economy, Investment and International Trade (DEIIT), highlighted the significance of the tariff agreement between China and the US, describing it as a positive development for global trade systems. The agreement effectively reduces US import tariffs on Chinese goods to 30% and China's tariffs on US goods to 10%, thus promoting normalized trade relations and addressing the US trade deficit with China.
Dr. Anusorn noted the importance of monitoring the global economic impact after the 90-day period. He emphasized that maintaining the reduced tariff levels could alleviate inflationary pressures, living costs, and goods shortages in the US, while adjusting multinational production networks positively. This could lead to an improved global GDP forecast, surpassing initial IMF and World Bank estimates. He warned that higher tariffs could hinder trade growth, economic expansion, employment, productivity, and value creation across various sectors. The easing of the trade conflict is expected to benefit many economic sectors globally.
Dr. Anusorn also stressed that Thailand's economy could surpass expectations for the remainder of the year if negotiations result in tariffs below 30%. He warned that a 36% tariff would hinder Thailand's ability to compete with Chinese products and urged proactive measures to mitigate the effects of US retaliatory tariffs. A reduction in tariffs to 10-15% could help sustain the Thai economy and export sector.
He highlighted that political stability in Thailand is a crucial factor in successful negotiations. Any changes in government or negotiation teams could pose challenges, as political instability might disadvantage Thailand in initiating timely negotiations with the US, compared to other Asian nations.