Will Thailand Face Higher Tariffs Under Trumponomics? | Yes, Thailand is likely to face higher tariffs under Trumponomics 2.0, as the U.S. administration continues to implement protectionist trade policies. The Trump administration has proposed tariffs of 10–20% on imports from countries with large trade surpluses with the U.S., and Thailand’s $41.5 billion trade surplus with the U.S. in 2024 places it among the top ten economies most exposed to such measures.

Sectors most vulnerable to these tariffs include electronics, automotive parts, rubber products, and agricultural goods, which make up a substantial portion of Thailand’s exports to the U.S. Should tariffs be imposed, estimates suggest that Thai exports to the U.S. could decline by 5–10%, amounting to approximately THB 190 billion in lost trade. This would translate into a 2% overall drop in Thailand’s exports in 2025, potentially reducing GDP growth by 0.3–0.5% due to lower export revenues and intensified competition from redirected Chinese goods in global markets.

In response, Thai policymakers are engaging in trade negotiations with U.S. officials to mitigate potential tariff increases. Strategies include emphasizing the role of U.S. investment in Thai-based production facilities and exploring new trade agreements with India, Africa, and BRICS nations to reduce dependency on the U.S. The government is also considering increasing imports of U.S. energy and agricultural products as a way to adjust Thailand’s trade balance and ease tensions with Washington.

While these measures could help limit direct impacts, broader shifts in global trade flows, supply chain relocations, and financial market movements will also shape Thailand’s trade prospects in the coming years.

Impact of U.S. Tariff Policies on Thai Exports

The latest U.S. trade policies prioritize reshoring manufacturing, reducing trade deficits, and shifting toward bilateral agreements over multilateral trade frameworks. At the 2025 World Economic Forum in Davos, Trump reaffirmed his administration’s approach, reinforcing concerns that countries with large trade surpluses with the U.S. would face additional tariffs.

Thailand’s electronics, automotive, rubber, and agricultural exports are at risk, given their contribution to the trade imbalance. A 10% tariff increase on Thai exports to the U.S. could reduce trade volumes by 5–10%, leading to an estimated THB 190 billion in export losses.

• Electronics and Automotive Parts: Thailand is a major exporter of computer components, electrical appliances, and vehicle parts, much of which is supplied to U.S.-based manufacturers. Higher tariffs could shift sourcing strategies toward alternative suppliers, affecting Thailand’s export-driven industries.
• Agricultural Exports: New sanitary and phytosanitary regulations from the U.S. could introduce additional compliance costs for Thai rice, tropical fruits, and seafood exports. Higher standards for pesticide residues and food safety could make Thai products less competitive.
• Rubber Products: Thailand, a global leader in natural rubber exports, supplies automotive and industrial manufacturers worldwide. If U.S. tariffs on rubber products increase, Thailand could experience both direct and indirect declines in demand, especially as Chinese manufacturers—major buyers of Thai rubber—adjust to lower U.S. imports of Chinese-made tires and industrial goods.

To address these risks, Thai policymakers are negotiating for preferential tariff treatment, arguing that many Thai exports are produced in U.S.-affiliated supply chains rather than competing directly with American goods. Meanwhile, efforts to diversify trade through free trade agreements (FTAs) with the EU, EFTA, and India are being prioritized to reduce Thailand’s reliance on the U.S. market.

China’s Redirected Exports in ASEAN

Beyond direct tariff risks, the global trade environment is also shifting due to U.S.-China tensions. Higher U.S. tariffs on Chinese goods are prompting Chinese manufacturers to seek alternative markets, with Thailand and ASEAN receiving a greater share of redirected exports.

This has led to increased competition in Thailand’s domestic market, particularly in electronics, machinery, and textiles, where Chinese manufacturers enjoy cost advantages. The influx of low-cost Chinese goods is challenging Thai producers, especially small and medium enterprises (SMEs) that lack the economies of scale to remain competitive.

Market analysts estimate that up to 30 Thai industrial sectors could experience increased pricing pressures by the end of 2025 unless adjustments in trade policy or business strategies are implemented.

To manage this, Thai policymakers are monitoring import trends and assessing options for industry support measures. While trade restrictions or non-tariff barriers could help protect local industries, such policies need to be carefully structured to avoid straining diplomatic and economic relations with China, Thailand’s largest trading partner.

Thai exporters are also adjusting their strategies by moving toward higher-value manufacturing, investing in automation, and expanding into alternative markets. Industry groups are advocating for greater investment in research and development (R&D), digital transformation, and workforce upskilling to improve Thailand’s competitiveness amid changing trade dynamics.

Supply Chain Adjustments in Manufacturing

Shifts in global supply chains are influencing investment patterns, with manufacturers reconsidering where to base production to minimize exposure to U.S.-China trade risks. ASEAN has emerged as a preferred region for supply chain realignments, and Thailand remains a leading destination due to its industrial infrastructure, skilled workforce, and trade agreements.

However, while some multinational firms are expanding operations in Thailand, investment patterns have been uneven. Some manufacturers have delayed relocation plans due to concerns over U.S. secondary sanctions on Chinese-affiliated firms moving to Southeast Asia.

The Board of Investment (BOI) has introduced incentives to attract high-tech industries, including semiconductor production, electric vehicle (EV) component manufacturing, and renewable energy projects. Workforce development programs have also been introduced to train labor for emerging industrial sectors, such as automation and AI-driven production.

With neighboring countries such as Vietnam and Malaysia also competing for investment, Thailand’s ability to secure new manufacturing projects will depend on maintaining policy stability, infrastructure improvements, and investor confidence.

Currency and Capital Movements Affecting Trade

Global trade uncertainty has affected capital flows and currency stability, leading to fluctuations in the Thai baht. As investors react to trade tensions and global interest rate policies, capital outflows have weakened the baht, making Thai exports more competitive while increasing import costs for key industrial inputs.

For manufacturers relying on imported raw materials and machinery, including electronics, automotive, and energy-intensive industries, rising costs could offset the benefits of currency-driven export gains. Meanwhile, the U.S. administration’s expansion of domestic oil and gas production is expected to lower global energy prices, potentially affecting Thailand’s fuel and energy import costs.

Policymakers are monitoring exchange rate movements closely to ensure that currency shifts remain manageable for exporters and importers alike.

Government Strategies on Trumponomics

Thailand’s response to global trade shifts includes diplomatic negotiations, export diversification, and industry-specific support programs.

Trade officials are actively working to secure tariff exemptions and preferential trade terms with the U.S., emphasizing that many Thai exports contribute to U.S. supply chains rather than directly competing with American products. Meanwhile, Thailand is strengthening trade relationships with India, the Middle East, and BRICS nations, reducing reliance on the U.S. market.

To help industries adjust, the government has introduced financial aid for SMEs, particularly in electronics and industrial production, while investment incentives have been expanded to high-tech manufacturing sectors. The Joint Standing Committee on Commerce, Industry, and Banking (JSCCIB) has also proposed a “War Room” initiative to track U.S. trade policies and help businesses adapt their strategies in real time.