Bangkok: "Phao Phum" has disclosed that the GDP for the second quarter is expected to exceed previous forecasts, highlighting the beneficial impact of a 19% US import tax. This tax rate is seen as a reflection of Thailand's manufacturing strength, providing structural advantages and paving the way for increased export investment. Plans are underway to introduce soft loan measures to assist exporters, with a positive second-quarter GDP outlook anticipated.
According to Thai News Agency, Deputy Finance Minister Paopum Rojanasakul noted that the second-quarter GDP figures for 2025 are likely to surpass initial projections made at the start of the year. Both domestic and international bodies have started revising their GDP forecasts for Thailand upwards. The Fiscal Policy Office (FPO) has adjusted its growth estimate from 2.1% to 2.2%, while the International Monetary Fund (IMF) has increased its forecast from 1.8% to 2.0%. The National Economic and Social Development Board (NESDB) is set to release the official GDP figures mid-month, which are expected to align with other positive economic indicators, such as export growth and less severe trade impacts than anticipated. The US import tariff rate of 19% is deemed satisfactory and on par with regional peers.
Thailand's tariff rates are lower than Vietnam's, reflecting the country's local production capabilities, which offer a structural advantage. The new US tariff measures differentiate rates based on "transshipment" levels, with goods primarily composed of third-country components facing higher tariffs. Thailand's extensive supply chain allows its products to benefit from lower tariffs compared to competitors like Vietnam.
The "Regional Value Content" (RVC) criterion further benefits Thailand by determining tax rates based on the proportion of raw materials and domestic production. Products with a higher domestic production value enjoy lower tax rates, a strength Thailand capitalizes on through robust basic industries and an enhanced production chain that increases domestic value.
Despite these changes, the tax adjustments have balanced trade advantages and costs, ensuring no country is at a clear disadvantage. Thailand's qualitative edge, derived from higher domestic production and competitive costs, is expected to attract more foreign investment.
The industrial sector is also responding to the tax increase. The government is formulating soft loan measures to support entrepreneurs, evaluating the impact to ensure appropriately scaled assistance. These measures are anticipated to be proposed to the Cabinet soon.
Meanwhile, some banks have proactively supported exporters facing US tariffs. For instance, EXIM Bank has introduced measures like debt repayment suspensions, interest rate cuts, increased credit, and support for market expansion activities such as loans for roadshows, trade fairs, and export insurance, thereby boosting confidence in the private sector's sustained market growth.