Washington will soon cut tax benefits on four more Thai export items - but the Commerce Ministry has urged the Public Health Ministry not to invoke compulsory licensing on more pharmaceutical products as a trade retaliation against the US.

The Health Ministry had planned to impose more compulsory licences next month after the US government announces its revision of its Generalised System of Preferences (GSP).

"The Thai government should exercise caution in response to more cuts in tariff privileges," a Commerce Ministry source said.

The Commerce Ministry yesterday urged exporters to focus more on trading with Asean and Asia instead of concentrating on the US.

It has signalled that jewellery made from metal will be the first item to be cut from the tariff privilege list due to high competitiveness and long extended benefits, according to the ministry's spokesman Krisda Piampongsant.

The US will announce its revision of the GSP for all trading partners, including Thailand, next week. Other Thai exports that will lose privileges are polyethylene plastic, radial tyres and colour TVs.

Krisda said that inevitably Thai exporters would face more difficulty in the US market because of tough competition.

To maintain export status, he suggested Thai exporters concentrate on Asean and countries such as China and India, which have high potential for an increase in consumption for both agricultural and industrial goods.

 Asean countries enjoy tariff cuts under the Asean Free Trade Area and fewer non-tariff barriers compared to developed countries, he said.

Krisda advised exporters to upgrade production standards and create added value to export products.

Petchanet Pratruangkrai

The Nation