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Published on January 28, 2008

Local shrimp are expected to re-enter the giant US market with low import duties this year.

This is because the Thai government believes the World Trade Organisation (WTO) will decide in the Kingdom's favour in its dispute with Washington.

"Thailand has a good chance of winning its case against the US. Washington has been primarily judged for unfair practices and already lost similar cases to other shrimp-exporting countries," a senior trade official last week said.

The WTO will release its official ruling next month on charges that the US was implementing double trade-protection measures: a continuous bond with a 100-per-cent bank guarantee and an anti-dumping duty.

The US would be able to appeal the WTO's judgement, which would delay the low tariff rate for three to six months.

If Thailand prevails, the US will have to revise its anti-dumping calculation imme-diately, and the bank guarantee for Thai exporters will be cancelled. Thai shrimp imports will then return to the tariff rate of 4.24 per cent this year.

Last year, Thai shrimp faced higher import duties than its rivals under the US anti-dumping measure, ranging from 5.79-6.82 per cent of a shipment's value. Thai shrimp exporters also put up US$180 million (Bt5.95 billion) for the C-bond last year, but the money was never returned.

Shrimp exporters are estimated to have to pay as much as $240 million for this year's C-bond.

Thai shrimp exports worldwide shrank 3.5 per cent to $2.15 billion last year. The US is the main market, at 49 per cent of the total.

The source said Washing-ton planned to appeal the case to the WTO if the ruling was not in their favour, thus showing a determination to fight the complaint to the very end. However, the source was confident the US would lose the final ruling.

If the US cannot comply immediately with the judgement, it will have to set up a compensation programme for Thai shrimp exports.

Thailand's petition is the third to the WTO filed by shrimp-exporting nations suffering from the double penalty by the US. Ecuador and India have already won their cases.

Now Thailand is considering filing a complaint against the Philippines for using an unfair safeguard measure against Thai mirrors for three years, even though its domestic industry has not been hurt by imports, a source from a mirror manufacturer said.

Thai mirrors cannot be exported to the Philippines.

Thailand could also be the target of complaints by the Philippines and the European Union.

The Philippines and the EU want Thailand to revise its product-price estimates, saying Philippine cigarettes and European whiskeys and wines have been assessed at too high a value, so that their products have faced very high duties and taxes.

Petchanet Pratruangkrai

The Nation