(Bloomberg) -- Thailand’s 12-month trade surplus with the U.S. exceeded $20 billion, increasing its chance of being included on the U.S. Treasury’s watchlist of currency manipulators.
The surplus reached $20.05 billion in the 12 months through November, according to U.S. Census Bureau data released Monday in Washington. That exceeds the $20 billion limit the U.S. Treasury has set for bilateral goods trade deficits, and means Thailand now violates two of the three criteria the Treasury uses to add a country to the watchlist.
The latest development increases scrutiny on Thailand’s currency policy at a time when officials are scrambling to rein in the baht’s almost 6% gain against the dollar over the past year, the fastest appreciation among major Asian currencies. The U.S. is Thailand’s third-biggest trading partner, with total trade of $47 billion in 2018.
The U.S. Treasury publishes a twice-yearly report designating countries of concern for currency manipulation if it meets two of three criteria:
- a trade surplus with the U.S. of at least $20 billion
- a current-account surplus of at least 2% of gross domestic product
- persistent, one-sided intervention in the currency equivalent to 2% of GDP in six months of a year
Thailand’s current account surplus has stayed above 2% of GDP for every quarter since the end of 2014, according to Bloomberg calculations.
The most recent Treasury report is overdue, having been delayed in late 2019 as the U.S. and China worked on a “phase one” trade agreement that’s expected to be signed Jan. 15.
Thailand has already been targeted by the U.S. for its trade policies. In October, the U.S. said it would suspend $1.3 billion in trade preferences that Thailand had enjoyed, citing failure to provide worker rights such as freedom of association and collective bargaining.
While Thailand’s Commerce Ministry said the impact of the move would be limited, it nonetheless put officials on guard as Asian exporters brace for crossfire in the ongoing U.S.-China trade war.
