SCB Economic Intelligence Center (SCB EIC) revealed that after Donald Trump was declared the victor of the 2024 election, SCB EIC analyzed the short-term effect of “Trump 2.0” on Thai’s economy through the lens of commerce and investment, intending to prepare the interested party for the effect and uncertainty that would follow.
The research was based on a hypothesis of the upcoming U.S. policy from the recent International Monetary Fund (IMF) research on the following topics.
Export: Trade restriction policy and tariff from the U.S. have slowed down the global economy, and have directly affected Thai’s economy in the following ways:
The increased tariff would affect Thailand’s exports to the U.S., which is its most important market, including computer electronics and consumer electronics.
U.S. expanding tariff on Chinese exports, combined with the unresolved overcapacity issue in China, may cause the country to seek new markets, and result in Chinese goods flooding other country’s markets, especially Thailand, making Thai producers face rising competition and slowing down recovery.
SCB EIC has estimated Thailand’s exportation value to decrease 0.8-1% from heightened trade restrictions.
Investment: A surge in uncertainty over the economy from Trump’s unclear trade policy, may cause investment to wane as investors wait for further clarification, and delay investment into Thailand for a short or even long term. The risk in investment would also continuously increase, especially since divestment from the U.S. would be a huge risk from the U.S. trade restriction policy that aims to bring investment back to the state.
SCB EIC has estimated Thailand’s private investment to decrease by 0.4-0.5% from developing uncertainty with commerce and global investment.
Overall, SCB EIC has estimated that Trump 2.0 will push Thailand’s 2025 economic growth to dwindle from its original forecast. The main drag is Thailand’s exports being under pressure from the decline in global trade, and investment into the country could not fully reap the benefit from foreign divestment.
According to the analysis, Thailand’s export and private investment would be greatly affected by Trump’s restriction measures and an increase in domestic investment. The Thai economy in 2025 may shrink around 0.5% compared to previous estimates before the election yielded results.
However, even if Trump 2.0, especially trade and investment restrictions, may push Thailand’s economy down next year, in the intermediate term, SCB EIC has expected that the restriction on various aspects between countries may cause a rift in the global economy to accelerate, and Thailand could exploit the changing global commerce landscape by being a neutral country trading with both sides.
