The Federation of Thai Industries (FTI) has put forward a two-tiered tariff proposal in response to potential reciprocal trade measures from the United States, aiming to protect domestic industries while differentiating between transshipped and locally manufactured goods.
Speaking on July 15, Wiwat Hemmondharop, Vice Chairman of the FTI, warned that a continued 36 percent reciprocal tariff from the United States could have a severe impact on key Thai export sectors, including steel, aluminum, textiles, and furniture. He emphasized that the FTI opposes the full removal of import tariffs on U.S. products, advocating instead for a more nuanced approach.
To mitigate the effects, the FTI has recommended that Thai trade negotiators—referred to collectively as “Team Thailand”—propose a two-level tariff framework. Under this model, goods merely passing through Thailand for re-export would be subject to a higher 40 percent rate, while products genuinely produced in Thailand would face a lower 20 percent tariff. The distinction aims to safeguard the competitiveness of authentic Thai exports.
Mr. Wiwat also noted that exports may experience a slowdown in the latter half of 2025, as U.S. importers had already increased their purchasing earlier in the year. In addition, the influx of Chinese products into the global market continues to place downward pressure on Thailand’s manufacturing sector.
Further discussions and negotiations with U.S. trade representatives are expected as the Thai government considers protective measures in light of global market dynamics and domestic industry concerns.
