Thailand is assessing the long-term impact of Trump’s trade policies through discussions on strategies to mitigate potential economic fallout. Experts emphasize the need for domestic consumption, effective currency management, and regional trade agreements amidst rising tariffs and market volatility. Potential scenarios signify both risks and opportunities, necessitating an adaptive approach to foreign trade and investment relations.
Thailand faces significant challenges due to Trump’s trade policies, as economic experts predict prolonged adverse effects on its economy. On a recent panel discussion, participants strategized on how Thailand might navigate the evolving landscape of U.S. trade policy under the theme, “Trade War 2025: How to Deal with Trump?” Don Nakornthap, the Bank of Thailand’s Reserve Management chief, warned of severe repercussions, comparing the possible outcome of escalating tariffs to a potential Great Depression, with nations, including Thailand, unable to escape the ramifications of such policies.
The rising U.S.-Thailand trade surplus places Thailand at risk of incurring higher export duties, amidst volatility in global markets and currencies. As the U.S. dollar fluctuates, fears mount that Trump’s strategies may inadvertently lead to a recession domestically. Therefore, Don highlighted three crucial strategies for Thailand: bolster domestic consumption, effectively manage foreign currency reserves, and utilize regional trade agreements within ASEAN to boost exports.
Kobsak Pootrakool, from FETCO, also stressed the importance of preparation for trade volatility, citing recent declines in stock indices. With the U.S. Dollar Index previously showing instability, the associated risks extend past economic realms into potential international conflicts. “This storm will stay with us for four years,” Pootrakool stated, indicating that increased market turbulence might hinder investment strategies going forward.
Dr. Kirida Bhaopichitr, of TDRI, pointed to significant consequences stemming from the trade war, including deceleration in global economic growth, particularly impacting export-driven economies like Thailand. She noted that while tariffs could pose challenges, they might also create openings for more U.S. imports as Thailand’s reliance on its exports remains high.
Moreover, Kriengkrai Thiennukul, from the FTI, identified increased scrutiny from the U.S. due to Thailand’s substantial trade surplus, urging for proactive government engagement. He highlighted the likelihood of tariff increases on aluminium and steel, emphasizing the necessity of diversifying markets as current overdependence on U.S. exports could backfire.
In a bid to rejuvenate trade amidst rising tensions, Kobsak proposed several immediate and long-term strategies for the government, especially in the automotive sector hit hardest by tariffs. Furthermore, Pisan Manawapat outlined seven actionable proposals, reiterating the importance of maintaining balanced relations both with the U.S. and China while highlighting opportunities in negotiating trade agreements and investment.
Lastly, Associate Professor Dr. Piti Srisangnam articulated the broader implications of Trump’s policies, stressing that trade intricacies might lead to unprecedented scenarios affecting Thailand. Two scenarios presented—”elephants colliding” and “elephants kissing”—highlight potential tariffs and changing investment paradigms that could further challenge Thailand’s economic landscape.
In summary, Thailand is grappling with the intricate challenges presented by Trump’s trade policies, emphasizing an urgent need for adaptive strategies to navigate potential tariffs and market volatility. Economic leaders have identified the importance of bolstering domestic strength, diversifying markets, and effectively managing bilateral relations. As Thailand faces risks, particularly in export-dependent sectors, strategic government interventions and proactive engagement with trade partners are vital for fostering resilience in these turbulent times.
Original Source: www.nationthailand.com
