NationThailand-July 23
Thailand is on edge ahead of the looming August 1, 2025, deadline, when the United States is set to announce its final decision on whether to maintain a steep 36% tariff on Thai exports or reduce the rate to a level comparable with other ASEAN countries. If the outcome is unfavorable, Thailand’s export sector—especially labor-intensive industries such as textiles, garments, gems and jewelery, electronics, electrical appliances, processed foods, and rubber products—could suffer a significant blow. These sectors rely heavily on the US as a primary export market. The repercussions are expected to ripple beyond just manufacturing and employment. Experts warn that sustained high tariffs could severely weaken Thailand’s competitiveness, hamper foreign direct investment (FDI), and stunt the country’s long-term economic growth. With regional rivals such as Vietnam and Indonesia securing lower tariff rates, Thailand risks being sidelined in the global investment arena.
Yuttana Silpsarnvitch, advisory board member and former president of the Thai Garment Manufacturers Association, said that he is deeply concerned about the export outlook for Thai garments in the remaining months of the year. “If the US decision puts Thailand at a disadvantage compared to competitors like Vietnam—who has already sealed a deal at a 20% rate—or Indonesia at 19%, buyers will likely shift more orders to those countries,” Yuttana said. “Meanwhile, Cambodia, still negotiating, remains under the same 36% tariff as Thailand.” He noted that foreign investors already operating in Vietnam and Indonesia are expected to scale up their operations in those markets if Thailand’s tariff rates remain elevated. This would inevitably result in a decrease in orders placed with Thai manufacturers and potentially trigger an exodus of production capacity away from Thailand. Read more at: https://www.nationthailand.com/business/economy/40052932
