In a bid to prevent the imposition of a punitive 36% export tariff by the United States, Thailand is offering expanded access to American agricultural and industrial products, along with increased commitments to purchase US energy and Boeing aircraft. The proposals come as the 90-day suspension of tariff enforcement, announced earlier by the Trump administration, nears its deadline.
Thailand’s revised offer aims to sharply reduce its $46 billion trade surplus with the US by 70% within five years, with the goal of achieving a balanced trade relationship within seven to eight years, Finance Minister Pichai Chunhavajira told Bloomberg News on Sunday. This new timeline accelerates Thailand’s previous pledge, which had proposed closing the gap over a 10-year period.
Minister Pichai said the updated proposal is expected to be submitted by Wednesday. If accepted, Thailand would implement immediate tariff and non-tariff reductions for most of the targeted goods, while applying a gradual easing process for others. Many of the US exports identified in the deal — particularly food and industrial goods — are in short supply in Thailand, minimizing any potential disruption to local producers.
“These terms offer mutual benefit,” Pichai noted, suggesting the United States would enjoy greater access to Thai markets while Thailand could streamline its trade processes and reduce bureaucratic barriers.
The move is part of a broader effort by several US trading partners to avoid steep tariffs on exports. Vietnam recently reached an agreement, though it still faces a 20% tariff on general goods and a 40% rate on items suspected of being transshipped. Thailand is pushing for a best-case scenario of 10%, though Pichai said a range between 10% and 20% would be acceptable.
Failure to strike a deal could significantly impact Thailand’s economy, which is heavily reliant on exports. A sharp drop in outbound shipments could reduce GDP growth by as much as one percentage point, government estimates show. Thailand’s economy is already under pressure from high household debt levels and slow domestic consumption.
As part of the proposal to narrow the trade gap, Thailand has enhanced its plans to import US energy, especially liquefied natural gas (LNG), and purchase Boeing aircraft. Major Thai companies, including SCG Chemicals Plc and PTT Global Chemical Plc, have committed to importing larger volumes of US ethane. PTT has also expressed interest in acquiring up to 2 million tonnes of LNG annually from Alaska’s gas project under a 20-year agreement. Meanwhile, Thai Airways is reportedly considering the acquisition of as many as 80 Boeing jets in the coming years.
The proposals were revised following Minister Pichai’s meeting with US Trade Representative Jamieson Greer and Deputy Treasury Secretary Michael Faulkender last Thursday — the first ministerial-level tariff talks between the two countries.
Thailand’s export performance, bolstered by early orders during the 90-day tariff reprieve, grew approximately 15% in the first five months of the year. Policymakers hope that a favorable deal with Washington will stabilize trade flows and reassure investors amid domestic political uncertainty following the suspension of Prime Minister Paetongtarn Shinawatra over ethical misconduct allegations related to a border dispute with Cambodia.
