Thailand is gearing up for a critical week in its trade relations with the United States, as technical-level negotiations on import tariffs are set to begin online between June 16 and June 22, 2025. Minister of Commerce Pichai Naripthaphan announced on June 16 that the country is fully prepared for these talks, although specific details remain under wraps due to a confidentiality agreement.
These negotiations come amid concerns over a 10% tariff imposed by the U.S., a move that could have significant implications for Thai exports. However, Pichai expressed confidence that the outcome will be favorable, anticipating a tariff rate around 10% that remains competitive. "We are optimistic that the tariff rate will be at a level that supports our exporters," he said, emphasizing that the discussions are currently at the technical level and conducted via online video conferences. Should the talks escalate to a ministerial level, Deputy Prime Minister and Finance Minister Pichai Chunhavajira is expected to lead the Thai delegation to the U.S.
Amid these developments, the Ministry of Commerce is set to release Thailand's export figures for May 2025 earlier than usual, on June 18. The numbers are expected to reveal strong growth, defying concerns that the new U.S. tariffs might dampen export momentum. "The export sector remains the hero driving Thailand's economy this year," Pichai remarked, expressing optimism that a negative export growth for the year is unlikely given the ministry's vigorous efforts.
Yet, the Thai Baht's strength poses a challenge. Pichai highlighted that while other countries have seen their currencies depreciate by about 20%, the Baht has remained strong, which could hurt both exports and tourism. He urged the Bank of Thailand to maintain the Baht at a more competitive rate of 37 to 38 Baht per U.S. dollar. "If there is a new governor at the Bank of Thailand, I hope they will manage the Baht to support exports and tourism," he stated, noting that a balanced exchange rate could also mitigate the impact of U.S. tariffs.
On the geopolitical front, the ongoing conflict between Israel and Iran has yet to significantly affect Thai exports, though it has contributed to rising oil and gold prices. The Ministry of Commerce is closely monitoring the situation to assess any potential fallout.
Concerns also arose regarding border trade with Cambodia, following reports of temporary closures at some crossing points. However, nearly 100% of Thai exports to Cambodia pass through five major checkpoints—Aranyaprathet, Klong Yai, Chanthaburi, Chong Chom, and Chong Sa-ngam—all of which remain open. Arada Fuengthong, Director-General of the Department of Foreign Trade, confirmed that while minor border points experienced short-term closures, these have had minimal impact on overall trade, primarily affecting small local traders.
Negotiations with the U.S. have also been influenced by President Trump's decision to delay the implementation of the cross-border adjustment tax by 90 days, extending the deadline to August 8, 2025. This postponement offers Thailand a critical window to finalize an agreement and potentially avoid the tariff's enforcement. Pichai indicated that if direct meetings become necessary, a delegation led by Deputy Prime Minister Pichai Chunhavajira and including the Permanent Secretary of Commerce will travel to the U.S. to advance discussions.
Despite the tight timeline, Pichai remains cautiously optimistic. "The negotiations are positive, and there is a 50/50 chance that Thailand will reach a conclusion before the 90-day delay expires," he said. This reflects a hopeful outlook that Thailand can secure tariff terms that protect its export competitiveness in a challenging global trade environment.
In sum, Thailand stands at a pivotal moment in its trade relationship with the United States, balancing diplomatic negotiations, currency management, and geopolitical uncertainties. The coming weeks will reveal whether these efforts can sustain Thailand's export growth and economic momentum amid external pressures.
