Trump’s policies may spell economic uncertainty for Thailand: NESDC
Trade barriers, fluctuating currency rates and tightened immigration policies could impact Thailand’s export sector and the broader economy, says the council
The National Economic and Social Development Council (NESDC) has warned of economic risks and uncertainty ahead stemming from US President Donald Trump’s policies.
During Trump’s first term as president from 2017 to 2021, the Thai economy suffered contraction as a fallout from the US-China trade war, Danucha Pichayanan, NESDC secretary-general said on Tuesday.
He said Trump is likely to resume his “Make America Great Again” policy, which focuses on getting American companies to return home to create jobs and drive the economy. It also includes building trade barriers against other countries, notably China.
Danucha said Trump’s foreign trade policies may start affecting Thailand’s export sector from the second quarter of next year, depending on the level of the policies and their impact.
“These policies, as well as the projected fluctuation in currency exchange, could pose serious risks and uncertainty to Thai businesses,” he warned.
Danucha said the NESDC was closely monitoring the implementation of Trump’s proposed policies in the following topics, as they could affect Thailand:
International trade: Increasing import tax across all products from China to 60%, and from other countries to 10-20%, revoking most-favoured-nation treatment, and leaving the Indo-Pacific Economic Framework.
Immigration: Increasing regulations regarding the employment of migrant workers with H-1B visas, requiring employers to verify the legal status of employees, and no longer granting US citizenship to children born in the country if their parents are undocumented.
Taxes: Permanent cuts on corporate tax under the Tax Cuts and Jobs Act (TCJA), which has been in effect since 2017 and was set to expire in 2025. This also includes a reduction in the corporate tax rate from 20-21% to 15% for companies producing locally.
Environment and clean energy: Supporting the use of fossil fuels, reducing investments under the Inflation Reduction Act, eliminating carbon tax credits and subsidies for environmentally friendly projects, relaxing pollution control measures, and withdrawing from the Paris Agreement.
International politics: Reducing involvement in international conflicts, taking a stance of not supporting NATO, cancelling aid to Ukraine while continuing support for Israel, and intensifying economic sanctions against Iran.
