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Thailand has lost US duty-free benefits

Samui Times Editor



Thailand has lost US duty-free benefits | Samui Times
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As of yesterday, Thailand has lost it’s duty-free access to 42.2 billion baht of exports to the US market.

Just 6 months after Washington warned that it would revoke trade privileges unless the kingdom agreed to labour rights reforms.

Once trade preferences for Thai products are removed, they are taxed at between 4% and 5%, making them more expensive on the lucrative US market.

Analysts say they expect the new duties to cause little direct damage.

The US has said that it would restore duties on just under one-third of the 1,43 trillion Baht value of Thai imports eligible for duty-free treatment under the US Generalized System of Preferences.

The US Trade Representative’s Office said in October that Thailand…

“had yet to take steps to ensure internationally recognized workers’ rights in a number of important areas”

Particularly in it’s fishing industry, notorious for slave labour and human trafficking, 6 years after the US unions raised the issue.

The US Embassy in Bangkok told VOA News last week that cuts to Thailand’s trade privileges would take place as planned.

Human Rights Watch and other groups have long accused Thailand of benefiting from widespread human trafficking and debt bondage among its millions of migrant workers, who are helping to drive the country’s economy, particularly its multibillion dollar seafood industry.

Last month, the International Labor Organisation reported on the industry that working conditions are improving, but not by much.

“Serious abuses persist for a large number of workers surveyed. Injuries are still common, employers still use debt to control employees, and migrants are still prohibited from forming unions by law.”

As the Deputy Director for Human Rights Watch in Asia points out, Thailand’s government has done almost nothing to address the outstanding concerns of the USTR over the past 6 months and welcomes Washington’s decision to implement the benefits cuts.

These are trade benefits that have been voluntarily extended to Thailand on the basis of certain conditions. These conditions are that Thailand respects labour rights, including freedom of association and the right to collective bargaining, and there is plenty of evidence to show that Bangkok has not reformed its highly deficient labour law or improved the implementation of various laws to protect labour rights.

Thai government spokeswoman, Ratchada Thanadirek said that labour law reforms are still in the works, but concise.

It’s not that we can’t do it, but there are things we can’t do right now. And when we’re going to draft a new law, we have to listen to all the stakeholders.

Some Thai labour groups are opposed to allowing migrant workers to form their own unions, claiming that they might have an advantage over the locals. Ratchada says giving migrant workers their own unions is not a panacea, not the only way to help them.

Having a migrant labour union does not mean that you can guarantee labour rights. But we are guaranteeing and protecting the rights of migrant workers, so I think that is more important than having a union itself.

As for the lost trade privileges, Ratchada says that the volume of Thai exports losing duty-free status is relatively modest and will not have a significant impact on the economy. Analysts and economists agree to this.

US Secretary of Commerce Wilbur Ross himself downplayed the coming cuts as “trivial” after a meeting with Thai PM Prayut Chan-o-cha in November.

The GSP issue was blown out of proportion. This is not a big deal.”


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