TRADE RECIPROCITY

Thailand sends a lot of products to the United States under the Generalized System of Preferences (GSP), which gives duty-free treatment to goods coming into the country. In fact, the southeast Asian nation is the second largest recipient of GSP benefits, with $3.9 billion of GSP-eligible products exported to the United States in 2016.

The problem is that trade doesn’t seem to be a two-way street with the Thais. The country has a number of non-tariff barriers that limit some U.S. products and act as a de facto ban on others, including pork.

The unjustified restrictions on U.S. pork are significant. Although Thailand’s 69 million people eat about 1 million metric tons of pork a year – that’s about 11 kilograms per person, which is nearly equal to the average Mexico’s 128 million people eat – the United States in 2016 shipped only 69 metric tons to the country.

Congress is about to reauthorize the GSP program, strengthening it to require the U.S. Trade Representative to report annually on the extent to which a country provides “equitable and reasonable access to its markets” for U.S. exports before renewing its eligibility.

Given that the United States has a $20 billion-plus trade deficit with Thailand – and a deficit in services as well – and that the Trump administration is focused on trade reciprocity, the Thais should be more than a little worried they may lose more than just their GSP benefits.