US investments in Thailand expected to decline due to Trump’s policies

The level of US direct investment in Thailand during the first quarter of this year suggests that US foreign direct investment (FDI) in the Kingdom is likely to remain low throughout 2025, mainly due to the policies of US President Donald Trump, Thai researchers have said.

In the first three months of 2025, US FDI in Thailand did not rank among the top ten countries with the highest investment levels—a sharp contrast to previous years.

In 2024, foreign investors applied for investment privileges from the Office of the Board of Investment (BOI) for 2,050 projects, a 51% increase from the previous year. The total value of these projects reached 832.114 billion baht, up 25% year-on-year.

In that same year, the United States ranked seventh, with 55 projects valued at 25.739 billion baht.

Factors Behind the Decline

The research division of Bank of Ayudhya outlined several key reasons for the expected drop in US FDI in Thailand in 2025:

• A slowing US economy, marked by rising unemployment and falling employment rates
• Increasing household and corporate debt in the US
• Ongoing high interest rates, which are curbing lending and slowing economic growth. The US economy is forecast to grow by 2.7% in 2025, compared to 2.8% in 2024
• Escalating trade tensions between the US and China, expected to dampen global investment flows
• Trump's “America First” policy, which is likely to encourage US investors to repatriate investment back to the US

Shift in Investment Patterns

Associate Professor Dr Aat Pisanwanich, an international investment expert, also predicted a fall in both US FDI and BOI applications in Thailand due to President Trump’s push to redirect American investment back to the domestic market.

Conversely, Dr Aat noted that Thai businesses are expected to increase their investments in the United States in a strategic effort to reduce Thailand’s trade surplus with the US and avoid the imposition of punitive import tariffs.

According to the Thai Chamber of Commerce, Thai FDI in the US has already reached approximately USD 17 billion (around 620 billion baht), supporting around 12,000 jobs across the US.

Last week, the President of Thai Trade Representatives led a delegation of Thai investors to attend the SelectUSA Investment Summit 2025, aiming to explore business opportunities across all 50 US states.