Thai air-con component exports to US soar amid heat wave surge
Rising heat waves in the United States have driven a surge in Thailand’s exports of air-conditioner components during the first quarter. The increase in demand has led to air-conditioner parts becoming the top product category benefiting from the generalised system of preferences (GSP) privileges awarded by the US.
The Foreign Trade Department reported that Thai exporters utilised GSP privileges worth US$819 million in the first three months of 2023, a 9.93% decrease from the same period last year. The US remained the largest market for Thai exporters using GSP privileges, followed by Switzerland, Norway, and the Commonwealth of Independent States (CIS).
“Air-conditioning components remained the leading product category benefiting from GSP privileges, with the export value increasing by 126% from the first quarter of last year to around $147 million,” said Ronnarong Phoolpipat, director-general of the Foreign Trade Department.
The US accounted for 92.6% of the GSP utilisation rate, with a value of $759 million. Switzerland ranked second with a value of $55.6 million and a utilisation rate of 28.2%. Norway ranked third with a value of $3.71 million and a utilisation rate of 53.5%. The CIS member states recorded $980,000 in value and a utilisation rate of 19.9%.
Thailand enjoys a 0% import tax exemption on more than 2,600 items from the US under the GSP, including seasoning, lenses, citric acid, rubber gloves, large-sized luggage, garment bags, and seamless copper tubes. Although the GSP programme with the US expired on December 31, 2021, importers who previously enjoyed GSP privileges will have to pay taxes at the normal rate until the programme is extended.
“Importers can still apply for the retention of GSP privileges for imported goods as usual, and the US will refund the tax once the programme is renewed,” added Phoolpipat.
High-value goods that utilise GSP privileges in exports to Switzerland, Norway, and the CIS member states include fragrances for food or beverages, precious gemstone jewellery, and packaging made of ethylene polymer (Switzerland), as well as sweet corn, suits for women or girls made of wool or fine animal hair, and seasonings (Norway), reports Bangkok Post.
