Business
What’s Next for Thailand as Trump Ups Global Tariff to 15%
The new US 15% global tariff—imposed under Section 122 of the Trade Act of 1974, effective February 24, 2026, for up to 150 days—replaces the higher “reciprocal” tariffs struck down by the US Supreme Court on February 20. For Thailand, this is largely a net positive in the near term.
Short-Term Impacts (Next 3–6 Months)
- Tariff relief and competitiveness boost: Thailand previously faced an average ~19% rate on many goods (higher on some products), while competitors like Singapore, the UK, and others enjoyed 10%. The uniform 15% levels the playing field and, on certain Thai products, could drop effective rates below 10% after exemptions or calculations. Finance Minister Ekniti Nitithanprapas called it a “more level playing field” that strengthens Thailand’s appeal as a manufacturing and investment hub.
- Export front-loading: Exporters are expected to rush shipments to the US in Q1–Q2 2026 to capitalize on the lower rate before any potential changes when the 150-day window expires. This could temporarily lift Thai exports (especially electronics, electrical appliances, food like chicken/seafood/canned fruits, and autos/parts) and support GDP growth momentum. Thailand already runs a trade surplus with the US.
- Investment and stock market lift: The reset is already boosting confidence (e.g., Stock Exchange of Thailand reaction) and could accelerate FDI and production relocation, building on a 68% rise in investment incentive applications last year.
Longer-Term Outlook and Risks
- After 150 days (around July 2026): The tariff expires unless Congress extends it. Uncertainty looms—will the US negotiate bilateral deals (as it has with the UK, EU, Japan, etc.), extend the baseline, or impose new measures tied to the US trade deficit with Thailand? Talks on a fuller US-Thai deal have been delayed by domestic politics (border issues, elections, coalition formation), with a new government possibly not in place until mid-2026.
- Challenges: A stronger baht (if the dollar weakens) could hurt competitiveness. All countries now face the same 15%, so Thailand loses some prior diversification edge from China+1 shifts. Certain SME export groups may still feel pressure.
- Opportunities: If Thailand delivers on negotiations and investment reforms, it can attract more manufacturing/FDI and reduce over-reliance on the US market. Officials like Ekniti are confident in pushing 2026 GDP growth toward 3% via public/private investment and FDI, even if external headwinds make 2%+ more realistic.
The announcement of a 15% global tariff by former President Donald Trump signifies a significant shift in international trade policy. Such an increase suggests a move towards more protectionist measures, aiming to bolster domestic industries while potentially raising costs for consumers and businesses worldwide. This tariff hike could disrupt the delicate balance of global supply chains, prompting companies to reassess sourcing strategies and production locations.
In response, trading partners may retaliate with their own tariffs, escalating trade tensions and risking a trade war. These developments could slow global economic growth and increase market volatility, negatively impacting investor confidence. Governments and businesses will need to navigate these new trade dynamics carefully, seeking ways to mitigate adverse effects while safeguarding economic stability.
Looking ahead, trade negotiations will likely become more complex as countries adjust to the new tariff landscape. Diplomatic efforts may intensify to negotiate exemptions or lower tariffs, aiming to avoid broader economic disruptions. Ultimately, the global trade environment post-15% tariff hike will hinge on diplomatic resolutions and the resilience of international markets.
