Trade and Investment
Thai – U.S. Economic Relations
The IMF estimates Thailand’s GDP at $538.7 billion (April 2021), making it the largest economy in Mainland Southeast Asia, second largest in ASEAN, and larger than some members of the G20. Thailand is currently the United States’ 19th-largest goods trading partner, with $48.8 billion in two-way goods trade during 2020. The United States contributed $17.7 billion of foreign direct investment (FDI) to Thailand in 2019, making it the third-largest foreign investor after Japan ($70 billion) and Singapore ($30 billion).
The U.S.-Thai Treaty of Amity and Economic Relations of 1833
The U.S.-Thai Treaty of Amity and Economic Relations of 1833, commonly referred to as the Treaty of Amity, is a special economic relationship between the United States of America and the Kingdom of Thailand that give special rights and benefits to U.S. citizens who wish to establish their businesses in Thailand. The Treaty of Amity treaty was amended in 1966 and provides two major benefits:
- American companies are permitted to maintain a majority shareholding or to wholly own its company, branch office or representative office located in Thailand.
- American companies receive national treatment, meaning U.S. firms may engage in business on the same basis as Thai companies, and are exempt from most of the restrictions on foreign investment imposed by the Alien Business Law of 1972.
Despite the Treaty of Amity, there are still certain restrictions on U.S. investment as follows:
- Owning land;
- Engaging in inland transportation and communication industries;
- Engaging in fiduciary functions;
- Engaging in banking involving depository functions;
- Engaging in domestic trade in indigenous agricultural products;
- Exploiting land or other natural resources
The U.S.-Thailand Trade and Investment Framework Agreement (TIFA)
The U.S.-Thailand Trade and Investment Framework Agreement (TIFA) was signed in 2002 and provides the strategic framework and principles for dialogue and cooperation on trade and investment issues between the United States and Thailand. In the most recent U.S.-Thailand TIFA meeting, the two sides reaffirmed the importance of working together to strengthen the bilateral trade relationship and discussed a full range of issues, including those related to General System of Preferences reviews, agriculture, customs, intellectual property protection and enforcement, and labor.
Thailand is U.S.’s 20th largest goods trading partner with $46.7 billion in total (two way) goods trade during 2019.The U.S. goods trade deficit with Thailand was $905.17 billion in 2020, a 5.95% increase over 2019.
- Thailand was the United States’ 25th largest goods export market in 2020.
- U.S. goods exports to Thailand in 2020 were $11.17 billion, down 16.01% from 2019.
- The top export categories (2-digit HS) in 2020 were: petroleum oils ($1.23 billion), electronic integrated circuits ($734 million), soybeans ($568 million), parts and accessories for tractor ($438 million), and electrical apparatus ($405million).
- U.S. total exports of agricultural products to Thailand totaled $1.8 billion in 2019, our 14th largest agricultural export market. Leading domestic export categories include: soybeans ($524 million), cotton ($215 million), wheat ($162 million), prepared food ($137 million), and distillers grains ($122 million).
- U.S. exports of services to Thailand were an estimated $3.4 billion in 2019, 6.5% ($207 million) more than 2018, and 90.0% greater than 2009 levels. Leading services exports from the U.S. to Thailand were in the travel, intellectual property (industrial processes), and financial services sectors.
- Thailand was the United States’ 16th largest supplier of goods imports in 2020.
- U.S. goods imports from Thailand totaled $37.6 billion in 2020, up 12.41% from 2019.
- The top import categories (2-digit HS) in 2020 were: automatic data processing machine ($6.01 billion), electrical machinery ($3.13 billion), rubber ($2.79 billion), diodes and transistors ($1.49 billion), and printing machinery ($928 million).
- U.S. total imports of agricultural products from Thailand totaled $2.9 billion in 2019, our 11th largest supplier of agricultural imports. Leading categories include: other consumer oriented ($807 million), rice ($644 million), processed fruit and vegetables ($475 million), rubber and allied products ($352 million), and fruit and vegetable juices ($154 million).
- U.S. total imports of agricultural products from Thailand totaled $2.9 billion in 2019, our 11th largest supplier of agricultural imports. Leading categories include: rice ($644 million), processed fruit & vegetables ($476 million), rubber & allied products ($352 million), fruit & vegetable juices ($154 million), and tree nuts ($108 million).
- U.S. foreign direct investment (FDI) in Thailand (stock) was $17.7 billion in 2019, a 4.6% increase from 2018. U.S. direct investment in Thailand is led by manufacturing, wholesale trade, and depository institutions.
- Thailand’s FDI in the United States (stock) was $1.9 billion in 2019, down 10.9% from 2018. Thailand’s direct investment in the U.S. is led by manufacturing, wholesale trade, and depository institutions.
- Sales of services in Thailand by majority U.S.-owned affiliates were $5.3 billion in 2017 (latest data available), while sales of services in the United States by majority Thailand-owned firms were $189 million.
- Thai Businesses in the U.S. (Source: Thai Business Information Center)
- U.S. Businesses in Thailand (Source: The American Chamber of Commerce in Thailand)
Last Edited: August, 2021