Julapun says Thailand cannot give in to US demands for zero tariff on agricultural products
Julapun says Thailand cannot agree to US demands for zero tariffs on agricultural products, citing long-term economic risks and impact on local industries.
Deputy Finance Minister Julapun Amornvivat stated that Thailand cannot yield to all US demands for zero tariffs on US products, as doing so would severely impact Thai farmers and the economy.
However, Julapun noted that he could not disclose the specific details of the US demands, as both countries' negotiators have signed a non-disclosure agreement.
Limited agreement on zero tariffs for specific products
Julapun said Thailand could agree to reduce import tariffs to zero only for products where the country has already established zero tariffs for specific countries.
“But we cannot lower import tariffs to zero for agricultural products or other sensitive items, as this would immediately affect the economic system,” Julapun explained.
Diversifying export markets to reduce reliance on the US
He advised Thai exporters to take advantage of the risks posed by steep US tariffs by seeking alternative markets, rather than relying solely on the US market.
Julapun further explained that if Thailand agreed to set zero tariffs for US agricultural exports, the kingdom would be obligated under multiple free trade agreements (FTAs) to apply the same tariff rate to products from other countries. This would significantly impact industries that Thailand needs to protect for the benefit of vulnerable groups, particularly farmers.
“If we agree to a zero rate for the US, we will not be able to reject similar demands from other countries with whom we have FTA agreements,” Julapun said.
Short-term gains, long-term consequences
He added that while the US demands might appear to have short-term benefits, they would have long-term consequences for industries that Thailand must protect.
“The Thai government wants the negotiation results to be win-win for both parties. Thailand is ready to lower tariffs on certain products that won’t affect the economic structure, but do not expect Thailand to remove tariffs on all products. Doing so would destroy our defence,” Julapun stated.
Government support for businesses and farmers
Julapun mentioned that the government has prepared a budget of 200 billion baht to provide soft loans to businesses and farmers who may be affected by steep US import tariffs. If the budget is insufficient, the government may increase it, he said.
Meanwhile, Deputy Prime Minister and Finance Minister Pichai Chunhavajira confirmed that the negotiating team is still updating the list of tariffs that could be lowered for the US. This updated list will be submitted before the deadline on August 1. He added that additional proposals would follow those submitted to the US Trade Representative on July 17.
