Pichai meets with business leaders to discuss upcoming US tariff talks, but Thailand’s chances of retaining the 10% baseline tariff rate are slim. Economic impact could be significant in 2025, with a cautious approach and potential trade-offs on the table.
Thailand has a steep hill to climb in forthcoming talks in Washington DC, if what sources to the talks between America and Vietnam suggest is true. On Friday, Deputy Prime Minister and Minister of Finance Pichai Chunhavajira gathered ministers, officials and key business representatives together at his ministry to compare notes and brainstorm. At the same time, he gave an insight into what he may be ready to offer the United States. However, it is becoming increasingly clear that the 10% tariff rate imposed already by the United States is just a floor. Indeed, it is unlikely to be reached by the Thai negotiation team. In turn, this means that the impact on the Thai economy will be quite significant in the course of 2025. That is unless something extraordinary happens in the forthcoming talks.
Thai Deputy Prime Minister and Minister of Finance Pichai Chunhavajira met other government ministers, departments, and business leaders on Friday. The meeting was convened at the Ministry of Finance. He was joined by Thailand’s other negotiators in upcoming talks with America led by his namesake, Minister of Commerce, Pichai Naripthaphan.
Indeed, at the meeting, Deputy PM Pichai joked that Americans could call both negotiators “Pichai.” Simultaneously, he confirmed that the US Trade Representative had confirmed talks with Thailand, though no definite appointment had been set yet. The Finance Minister expressed eagerness to travel to the United States as soon as possible.
Pichai eager to travel to the US for talks, confirms readiness for negotiations despite no set date yet
“As for when I will fly to the US for negotiations, it has to be as soon as possible. I confirm that the USTR has responded, but the date has not been set. I am ready to fly with the Commerce Minister because we are on the same team. Call me ‘Pichai’ so that both of us can turn to each other at the same time, and the private sector will join in for strength,” said Mr. Pichai.
The meeting was also attended by representatives from the Federation of Thai Industries (FTI), the Ministry of Agriculture, and the Export-Import Bank of Thailand (Exim). Additionally, Government House spokesman Jirayu Huangsap was present.
In fact, the meeting brought together representatives from key sectors, including the Ministries of Finance, Commerce, Agriculture and Cooperatives, and Industry, along with senior executives from the Customs Department and Thai Chamber of Commerce.
The extended session, lasting more than two hours, focused on shaping Thailand’s strategic response to recent US trade measures, particularly higher tariffs. According to Mr. Jirayu, the discussions aimed to balance trade in agricultural and processed food products with the United States by leveraging Thailand’s comparative strengths.
Meeting focuses on balancing agricultural and processed food trade with US while addressing tariffs
Minister Pichai outlined what he would propose to the United States. Politically, he ruled out importing US pork at this time. There has been a rapidly growing political issue with Agriculture Minister Narumon Pinyosinwat expressing her concerns on Tuesday.
In short, Thailand will crack down on export origin fraud to reduce Chinese exports using the country as a base. However, Mr. Pichai was equivocal about easing tariffs.
Essentially, he suggested that America would be offered similar terms to other nations. Certainly, this would appear to justify the US assault on Thailand and the 36% tariff originally imposed.
Thailand is also preparing measures to reassure Washington that goods exported from the kingdom are genuinely Thai.
The government is strengthening certification and inspection regimes to prevent third-country imports—especially from China—from being passed off as Thai exports. The move mirrors similar commitments from Vietnam, which has also been under pressure for facilitating the transhipment of Chinese goods.
Pichai proposes measures to address trade fraud and ensures the authenticity of Thai exports to the US
For instance, Mr. Pichai was equivocal on whether Thailand would lower the duties on Harley Davidson motorbikes. Significantly, at the White House Rose Garden, when retaliatory tariffs were unveiled on April 2nd, this was particularly mentioned by Trump.
Currently, Harley Davidson motorbikes are subject to a 60% tariff rate in Thailand. Meanwhile, Japan enjoys a 0% tariff under the Japan-Thailand Economic Partnership Agreement. Additionally, Harley’s are subject to a 35% surcharge.
Furthermore, Thailand also charges a 15% VAT on all imported motorbikes. Despite this, on Friday, Mr. Pichai did not commit to offering the United States the same terms as Japan.
He did suggest that the kingdom would buy more corn. The country currently faces a shortfall in what it produces locally. Mr. Pichai talked about purchasing a shortfall of 5 million tons.
The Deputy Prime Minister said that Thailand consumes 9 million tons of corn annually, but domestic production meets only about 4 million tons.
Pichai discusses potential purchases of US corn as well as tariffs on motorbikes and agricultural imports
He proposed reallocating imports in favour of the United States, noting that American corn is competitively priced.
This could reduce costs for Thailand’s animal feed sector, which would in turn support pet food exports—a growing industry where Thailand already contributes 21 million tons, largely premium grade.
Presently, Thailand imposes a 73% duty on such products from the United States. In addition, he talked about buying LNG gas from the United States on the condition that the price was favourable. He also suggested that Thai energy firms might like to invest in America’s booming energy sector.
Mr. Pichai added that any natural gas import deals would have to be negotiated carefully to ensure prices are advantageous to Thailand. He hinted that state enterprises could explore investments in US-based natural gas sources, with trade-offs considered in Thailand’s favour.
Pichai proposes buying US corn and LNG while exploring energy investments to reduce the trade deficit
Finally, he suggested that Thai Airways in its medium-term positioning plan may buy US-made Boeing jets. Presently, Thailand is subject to a 10% baseline tax. After that was imposed, it is projected to lower Thailand’s growth prospects to 1.5% for 2025.
The potential Boeing aircraft procurement, scheduled over the next two to three years, would be part of Thai Airways’ fleet renewal plan and would help reduce Thailand’s trade surplus with the US—one of the factors prompting US scrutiny.
Certainly, whatever deal is forged by Mr. Pichai in Washington DC in the coming weeks, the chance of attaining that 10% rate again is slim. Certainly, the negotiations have already started between US trade representatives and Vietnam. Deputy Premier Ho Duc Phoc was in the US capital last week.
Vietnam is also offering the US lower trade and deal sweeteners. In addition, it is offering to crack down on export fraud.
For instance, it has emerged that Chinese ships laden with US exports would simply stay for a required period at a Vietnamese port previously to have the exports board qualified as originating in Vietnam.
Pichai suggests Thai Airways may purchase US-made Boeing jets to help balance Thai-American trade
Thailand has learned from this, according to Mr. Pichai, and is now committed to tightening rules on product origin. Stricter enforcement of customs and anti-fraud measures will form part of the broader Thai proposal to the United States.
Certainly, it is now accepted that export fraud was widespread in both Vietnam and Thailand. Significantly for Vietnam, tariffs to the United States on some sectors have already been lowered. Certainly, Thailand is being notably reticent.
Indeed, Deputy Prime Minister Pichai on Friday said any deal must be a good one for the Thai public and the country’s commercial sector.
In short, there will be no open and sweeping trade arrangement which gives the United States free trade access. Notably also, on Friday, there was no mention among Thai officials and the business class of the investment climate from America to concerns in Thailand. At the same time, Vietnam is now known to be exploring this with US trade representatives.
Thailand tightens product origin rules to address trade fraud concerns and protect the domestic economy
Even now at this time, Vietnamese sources suggest that the country expects to emerge from these negotiations with a tariff rate still in pay of between 22-28%.
Significantly, the Vietnamese see no prospect of the 10% baseline rate being achieved for its exports. Certainly, this may come as a shock to Thailand.
For instance, if tariffs are only reduced from 36 to 20%, this would all but wipe out growth in Thailand in 2025. Certainly, the impact may even be deeper than this as the world economy is expected to suffer at least a short-term negative impact.
In the final analysis, Thailand appears to be cautious. Certainly, these talks offer valuable insights into how the kingdom has previously prioritised its Asian trade partners. This includes China and Japan.
Thailand cautiously plans to lower some import tariffs on US goods while preparing for negative impacts
This is indeed reflected in Thai public opinion. A survey conducted in recent days shows 85% of people are concerned about the US tariffs. 50.3% are concerned about what the Thai government’s response may be.
Finally, only 30.15% of Thai people agreed with reduced taxes and tariffs in return for American products. In the meantime, 60.5% favoured bringing in third parties such as the World Trade Organisation (WTO) to mediate. Additionally, significantly, 9.35% favour raising tariffs on America and insisting on a Thai-US trade war.
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Mr. Pichai, in his concluding remarks on Friday, emphasised the government’s firm stance: while negotiations are essential, domestic producers and Thailand’s broader economic interests must not be compromised. With trade a critical pillar of national development, his goal is to achieve mutual benefit—but not at any cost.
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Further reading:
Trump’s remaking of World trade, if it works, will force Thailand to decide between the US and China
US offers a 90-day tariff pause but Thailand must move faster as it already faces shaved GDP in 2025
PM addresses the nation in shock over last week’s earthquake and this week’s Trump tariff bombshell
Finance Minister to travel to US to import more US food and motorbikes while lowering Thai tariffs
Trump’s trade war coming down hard on Thailand despite reports of talk. Reciprocal tariffs days away
