BANGKOK: The United States is again emerging as a major challenge for Thailand’s export sector amid moves to consider trade measures against Thai goods under Section 301 of the US Trade Act of 1974.
Concerns over forced labour in supply chains, particularly in the fishing industry, are among the main issues being raised.
The situation has caused concern among Thai businesses because the United States is Thailand’s largest export market and plays an important role for a wide range of goods, from food and processed agricultural products to electronics, electrical appliances, vehicles and parts, and other industrial products.
However, the Office of the United States Trade Representative has yet to issue a final announcement confirming either an additional 12.5% tariff on Thai goods or its implementation on July 24, as suggested by some information that has been circulated.
The proposed rate remains under consideration and negotiation.
Section 301 is a US trade instrument that authorises the government to take retaliatory measures against trading partners if it considers their policies, regulations, or practices to be affecting United States economic interests.
The United States has previously used the measure against several countries, including China, over intellectual property and technology transfer, and as a mechanism to pressure trading partners to improve trade rules.
In Thailand’s case, the central issue does not centre solely on the trade deficit, but is also linked to labour standards and the transparency of product supply chains, particularly US concerns about preventing forced labour in fishing and related industries.
Thailand has previously faced scrutiny over illegal labour in the fishing sector, prompting the government to accelerate improvements to oversight, including worker registration, fishing-vessel inspections, product traceability and labour-protection measures.
Although Thailand has made progress, the United States continues to focus on practical results, particularly the ability to prove that goods entering its market are not linked to forced labour.
US pressure does not arise only from labour problems in the fishing sector, but is also linked to its approach to controlling imports of goods at risk of being associated with forced labour.
Furthermore, the United States applies strict measures to block goods linked to forced labour through laws and mechanisms administered by US Customs and Border Protection, requiring US importers to demonstrate the origin of goods and the transparency of their supply chains.
This has prompted many exporting countries to accelerate the development of traceability systems and labour standards to reduce trade risks.
For Thailand, the product groups at greatest risk if the US proceeds are seafood, processed fishery products and goods connected to fisheries supply chains.
They are directly linked to concerns about forced labour in domestic industries and raw-material supply chains, as well as imported goods used for production and export to the United States.
Thailand’s position in this area remains unclear, and it has no law banning imports from sources that use forced labour, an important reason it has come under US scrutiny.
Other products, such as electronics, vehicles, parts and electrical appliances, are also major Thai exports, but there is currently no confirmed information that they would fall within the scope of the measure.
The proposed 12.5% tariff is being closely watched by the market because, if imposed, it would raise costs and make it harder for Thai exporters to compete in the US market. — The Nation/ANN
