Bangkok: The US has categorized Thailand as a Tier 2 country, highlighting its role as a "transit point for Chinese goods" in a recent report by the White House. This classification comes ahead of critical Thai-U.S. trade negotiations, set to be led by Deputy Prime Minister Supajee Suthamphan at the end of August.
According to Thai News Agency, the White House unveiled a report titled "The Great Transshipment Scam" on August 13, 2026. The report scrutinizes the transshipment of goods through various countries to bypass U.S. tariffs and trade restrictions, placing approximately 40 countries under U.S. examination. Thailand has been placed in Tier 2, a group described as "Scale Leaders with Significant Economic Integration with China," alongside Brazil, Indonesia, Malaysia, Turkey, and Vietnam. These countries are noted for their substantial transit volumes and deep economic ties with China.
The report further explains that Thailand, along with Vietnam, Malaysia, and Indonesia, has significant connections with manufacturing networks near China. These countries act as crucial bases for industries such as electronics, machinery, plastics, and garments, utilizing production factors from China.
This strategic classification precedes Supajee Suthamphan's visit to the United States, where she will lead the Thai delegation in negotiating the Agreement on Reciprocal Trade (ART). Thailand aims to secure competitive advantages for its products and advocate for additional tariff-exempt items. Supajee has previously indicated that Thailand plans to bolster investment by Thai businesses in the US and increase imports of goods not produced or insufficiently produced domestically, to address trade imbalances.
Currently, Thai private sector investment in the US has reached nearly US$20 billion, with plans to invest an additional US$5 billion. Thailand is also keen to expedite the ART negotiations.
Further complicating matters, the US announced Section 301 measures on July 23, 2026, which include a 12.5% tariff on goods from countries associated with forced labor practices. Thailand is working to enact legislation to ban imports of goods produced with forced labor, aiming to reduce the tariff to 10%.
Additionally, the U.S. Trade Representative is conducting a Section 301 investigation into structural excess capacity in manufacturing sectors, launched on March 11, 2026. Thailand is among 16 economies under investigation. The Thai team has provided data to address concerns in the automotive, rubber, and machinery industries, reporting capacity utilization rates between 75-95 percent.
The positioning of Thailand in Tier 2 is a significant development as the country prepares for trade discussions with the United States. Observers are keen to see how this classification will impact the forthcoming negotiations.