Thailand could face a significant blow to exports if proposed US Section 301 tariffs take effect after 24 July, according to Pachara Naripthaphan, a member of the Securities and Exchange Commission board. Speaking on 17 July, Pachara said Thailand's proposed 12.5% rate would exceed the 10% rates facing Indonesia and Malaysia. He urged the government to address structural weaknesses rather than relying solely on economic stimulus. Thailand is currently subject to a 10% US tariff under Section 122, the same rate applied to other ASEAN countries. That measure expires automatically after 150 days, on 24 July. Pachara said the proposed higher rate for Thailand reflects its classification among countries without effective enforcement measures against goods made with forced labour. Singapore, the Philippines and Vietnam are in the same group, he said. Exports have been carrying the economy Thai exports rose 23.1% in April before slowing to 10.6% in May, supported by electronics and advance orders placed before US tariff measures took effect. Pachara said the broader domestic picture was weaker, with growth being driven by exports and investment rather than recovering household purchasing power. Thailand recorded a current-account deficit of US$7.6 billion in May, while household debt remained high at 85.9% of GDP. The US was Thailand's largest export market from January to May 2026. Exports to the US totalled about US$38 billion, or 23.5% of all Thai exports, up 40.3% on the same period a year earlier. However, Pachara said part of that growth resulted from businesses bringing shipments forward. Once this effect fades in the second quarter and tariffs are fully imposed, exports could weaken noticeably. For businesses running export, sourcing or manufacturing businesses in Thailand, the warning highlights a potential rise in costs and uncertainty for companies heavily reliant on US customers. Pachara said listed companies with substantial US-market exposure could see effects on investment applications, production and business performance. Longer-term trade risks Unlike Section 122, Section 301 does not simply lapse after a set short period. Under the law, it ends after four years unless the Office of the US Trade Representative receives a request to continue it and agrees following a review. In practice, Pachara said, such measures can remain in place for years and may be reintroduced in some circumstances. Failure by a trading partner to meet agreed commitments could also trigger enforcement action again. He added that further Section 232 tariffs apply to steel and aluminium products, while negotiations by the Thai delegation remain under way. Pachara said the greater concern was not only the 12.5% figure but the Section 301 negative list, which largely covers Thailand's main export products. He also pointed to a US investigation into industrial overcapacity, citing Thailand's low capacity utilisation over two consecutive years. Calls for stronger oversight Pachara also called for clear government action on alleged corruption in local civil-service examinations, saying transparency and communication were needed to restore public and investor confidence. He raised concerns over data-centre expansion to support AI investment, including criticism that some projects register as buildings to avoid environmental-impact assessments. The spread of supported sites has also prompted concerns about local water resources and whether communities receive genuine benefits. He said Thailand must strengthen its competitiveness as Malaysia, Vietnam and Indonesia move aggressively to address their own weaknesses. Without structural reforms, he warned, additional stimulus spending could be absorbed by accumulated private-sector and household debt rather than improving productivity. Join the discussion? 18 July 2026
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