The government on Monday ruled out extending safeguard measures on imported hot-rolled steel sheet with alloy, both in coils and not in coils, after a probe found no injury to the domestic steel industry.
Yesterday deputy commerce minister Chutima Bunyapraphasara, who chaired the meeting of the Trade Interests and Remedies Committee on Jan 7, said extending such measures may put the country at risk from trade retaliation.
Thailand exercised the safeguard measures on imported steel for the first time from Feb 27, 2013 to Feb 26, 2016. The measures were subject to renewal from Feb 27, 2016, to Feb 26, 2019.
"The committee considers the extension of the safeguard measures unnecessary because the investigation showed the import volume and market share of such steel imports dropped, while the domestic sales volume and capacity utilisation increased in 2017 and 2018. The probe also found the losses of the affected companies reduced and employment increased," said Ms Chutima.
A safeguard measure is a procedure under the World Trade Organization (WTO) that permits a government to act against an unusual rise in imports of similar goods from trading partners. The measure normally takes the form of additional duties or import quotas lasting several years.
Thailand has two major hot-rolled steel sheet makers -- Sahaviriya Steel Industries Plc, the country's biggest hot-rolled steel sheet producer, and G Steel Plc.
Ms Chutima said although the safeguard measures are allowed to be used to protect local industries, the WTO's rules limit the effective period to 10 years.
If Thailand continued to exercise the measures, at least three countries -- South Korea, Turkey and Egypt -- were set to ask for a consultation with the WTO, and Thailand would need to come up with sufficient rationale to defend why the measures are necessary for another two years, she said.
Under the safeguard measures, imported steel is subject to a tariff of 39.1%.