Connect with us

Economy

Thai exports will suffer from Trump labour rights decision

Jack Burton

Published 

 on 

Thai exports will suffer from Trump labour rights decision | The Thaiger
The Thaiger
  • follow us in feedly

The Thai export sector will suffer another blow after the US President Donald Trump announced on Friday the suspension of 1.3 billion dollars worth of duty-free trade for certain Thai goods, claiming Thailand has not taken steps to protect the labor rights.

In a letter to US House of Representatives Speaker Nancy Pelosi and Vice President Mike Pence, Trump said he had suspended the duty-free treatment because Thailand had not taken steps to “afford workers in Thailand internationally recognized worker rights.”

The US Trade Representative (USTR)’s’s office said the move amounted to a suspension of 1.3 billion dollars in trade preferences under the Generalized System of Preferences (GSP) program. At present, the GSP covers around 4.5 billion dollars of Thai exports.

The suspension, which takes effect in six months, will affect about a third of Thailand’s products including all of Thailand’s seafood exports to the US.

While the list of products subject for suspension has not yet been made available, the absence of GSP is likely to dampen the already grim prospects of Thai exports this year.

Thai outbound shipments in 2019 are likely to see a flat growth or even a contraction for the first time in four years, due to the gloomy global economy, the prolonged trade war between the US and China and the strong Thai baht, according to several economic think tanks.

Thai exports in September fell from the previous month, and declined by 1.4 percent compared to the same period last year. Although the figure is better than a 4-percent drop from the previous month, it is worse than the market expectations.

The suspension on GSP does not come as a total surprise. Earlier this year, Thailand narrowly avoided being labeled a currency manipulator on the US Department of Treasury’s watchlist, because Thailand does not meet all the conditions set by Washington.

Thailand’s current account surplus accounted for over 7% of the country’s gross domestic product in 2018, versus the limit set by the US Treasury of 2%. Moreover, the amount of foreign currency purchases did not increase from the previous year. Thailand’s trade surplus with the US was USD19 billion, approaching the limit of USD20 billion.

While the US action toward countries labeled currency manipulator is not clearly defined, Washington can unilaterally end GSP benefits to take action against high trade deficits with its trading partners.

The announcement is likely further impact Thai fishery business after an issue in the European Union.

Even though the EU in January announced the lifting of a yellow card for Thailand in recognition of its progress in tackling illegal, unreported and unregulated (IUU) fishing, Thailand’s fishery exports to the EU have not recovered to pre-IUU levels so far.

Thailand is the second biggest beneficiary of the US’s GSP after India, which was the largest with 5.7 billion dollars in exports to the US in 2017, until Washington decided to terminate India’s designation as a beneficiary developing nation in May.

At present a wide range of Thai export items receive GSP benefits, the biggest being electrical appliances and electronics such as air conditioning and electronic components and washing machines, food and agriculture and machinery.

The prospects for GSP for Thai exports are not promising. Last year, the USTR’s office accepted a petition from the National Pork Producers Council challenging Thailand’s eligibility for the GSP program.

The American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) also filed a petition to review Thailand’s eligibility, based on labor issue.

According to the USTR, Thailand is the United States’ 20th largest goods trading partner, and two-way trade between them totaled 44.5 billion dollars in 2018. The U.S. goods trade deficit with Thailand was 19.3 billion dollars in 2018.

SOURCE: thaipbsworld.com

Keep in contact with The Thaiger by following our Facebook page.
Never miss out on future posts by following The Thaiger.



Find more SE Asian News courtesy of The Thaiger.

Broke? Find employment in Southeast Asia with JobCute Thailand. Rich? Invest in real estate across Asia with FazWaz Property Group. Even book medical procedures worldwide with MyMediTravel, all powered by DB Ventures.

Read more headlines, reports & breaking news in Bangkok. Or catch up on your Thailand news.

Jack Burton is an American writer, broadcaster, linguist and journalist who has lived in Asia since 1987. A native of the state of Georgia, he attended the The University of Georgia's Henry Grady School of Journalism, which hands out journalism's prestigious Peabody Awards. His works have appeared in The China Post, The South China Morning Post, The International Herald Tribune and many magazines throughout Asia and the world. He is fluent in Mandarin and has appeared on television and radio for decades in Taiwan, Mainland China, Hong Kong and Macau.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Crime

Allegedly drunk woman tries to run down Bangkok pedestrians

Jack Burton

Published

on

Allegedly drunk woman tries to run down Bangkok pedestrians | The Thaiger
PHOTO: Nation Thailand

A 37 year old businesswoman tried to run over pedestrians with her car near Bangkok’s Khae Rai Intersection and Tao Poon MRT station, after learning her business was embezzled out of millions of baht. She was allegedly drunk at the time. Bang Sue police were notified of the incident in the early hours of this morning and tracked down the car, but the driver tried to flee to Or Tor Kor Market in Chatuchak district. It was reported that she tried unsuccessfully to ram pedestrians near Khae Rai Intersection in Nonthaburi province at 11:00 last night and then headed into […]

Continue Reading

Events

British embassy in Thailand issues advice over student demonstrations

The Thaiger

Published

on

British embassy in Thailand issues advice over student demonstrations | The Thaiger
PHOTO: The 3-finger salute is being used as a symbol for anti-government student protests

The British Embassy has issued travel advice that applies to all foreigners living in Thailand. The ‘advice’ refers to the escalation of the student and activist anti-government protests. In the past, generally, these situations don’t end well once there is a critical mass and the government, via the Army, decide to step in.But at this stage the tone of both sides has been peaceful. The government are mindful of the impact of the local Covid-19 outbreak, and the lockdowns, and would want to avoid any bad publicity from a student protest crackdown to exacerbate the situation. The Thai PM has, […]

Continue Reading

Crime

Deputy AG in Vorayuth case resigns

Jack Burton

Published

on

Deputy AG in Vorayuth case resigns | The Thaiger
FILE PHOTO

The deputy attorney-general who endorsed public prosecutors’ decision not to prosecute Red Bull heir Vorayuth Yoovidhya in the controversial hit-and run case which took the life of a senior police officer, has handed in his resignation. A statement released today from the Office of the Attorney-General announced that Deputy AG Nate Narksook has tendered his resignation letter to Attorney-General Wongsakul Kittipromwong, to indicate his honesty in the handling of the Vorayuth case. The resignation will only become effective after it’s approved by the AG. According to the statement, Narksook insists he performed his duty as assigned and endorsed the prosecutors’ […]

Continue Reading
Follow The Thaiger by email:

Trending