Trump orders investigation into Thailand trade imbalance

(File) U.S. President-elect Donald Trump. Pic: Reuters/Carlo Allegri/Files

Thailand is among 16 countries that President Donald Trump has targeted in an order calling for an investigation into the US trade imbalance.

Mr Trump also promised on Friday to crack down on “foreign importers that cheat”, signing two executive orders that he said would lead to a historic reversal of his country’s trade deficit.

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The US is Thailand’s third-largest trading partner, after China and Japan. Two-way trade between Thailand and US amounted to US$36.5 billion (1.28 trillion baht) in 2016, $24.49 billion of which was from Thai exports.

Thailand enjoyed a $12.4-billion trade surplus with the US last year, up from $10 billion in 2015, reported the Commerce Ministry.

Key export products to the US include machinery, electrical appliances, electronics and parts, rubber products and gems and jewellery.

Local industry experts warned earlier this week shipments of Thai-made auto parts and tyres to the US could suffer if the Trump administration follows through on some of its protectionist rhetoric or imposes a “border adjustment tax”. About 35% of US tyre imports come from Thailand.

On Friday, Mr Trump directed some tough talk at importers he believes are not playing by the rules.

“They’re cheaters! From now on, those who break the rules will face the consequences and they’ll be very severe consequences,” he said.

He blamed the trade imbalance largely on unscrupulous foreign powers, aided by US special interests that have helped push through “bad trade deals”.

“Thousands of factories have been stolen from our country, but these voiceless Americans now have a voice in the White House,” he said.

The first of two orders will require a report on the causes of the trade imbalance within 90 days. It will focus on 16 countries: China, Japan, Germany, Mexico, Ireland, Vietnam, Italy, Korea, Malaysia, India, Thailand, France, Switzerland, Taiwan, Indonesia and Canada.

The Trump administration plans public meetings to hear from manufacturers, service providers, workers, farmers and consumers.

The second order calls for a strategy for customs agents to use legal tools to collect anti-dumping duties already owed to the US. The White House is proposing to require new importers — or those already found guilty of abusive trade practices — to post a bond before their goods are permitted through US ports.

The Government Accountability Office says importers have racked up more than $2.3 billion in uncollected anti-dumping and countervailing duties since 2001.

“This marks the beginning of a totally new chapter in the American trade relationship with our partners overseas,” said Commerce Secretary Wilbur Ross.

Pimchanok Vonkorpon, director-general of Thailand’s Trade Policy and Strategy Office, said Commerce Minister Apiradi Tantraporn has ordered relevant agencies to closely monitor the US moves following the executive orders. The agencies have been directed to evaluate the impacts from expected measures the US would adopt.

Initially, the protectionist measures are expected to cover anti-dumping, countervailing duty and intellectual property, Ms Pimchanok said.

On Monday Thailand is scheduled to host the Thai-US meeting on the Trade and Investment Framework Agreement (Tifa), bilateral trade talks between senior officials of the two countries. Thailand and the US signed Tifa in 2002 to address trade issues of long-standing concern and often to establish the necessary conditions for movement towards a free trade agreement (FTA).

Tifa meetings were suspended in October 2003 after president George W Bush announced the US’s intention to negotiate an FTA with Thailand.

Under Tifa, the US and Thailand have focused on action plans to address US concerns regarding Thailand’s IP rights and customs regimes.

-The Bangkok Post

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