Thailand’s prime minister has ordered a study into the potential impacts of U.S. trade policy on Thai exports, reflecting the country’s concern about the uncertainties created by the return of President Donald Trump to the White House.
Speaking after the cabinet meeting yesterday, the Bangkok Post reported government spokesman Jirayu Huangsub as saying that Prime Minister Paetongtarn Shinawatra wanted more information about the likely impact that Trump’s expected slew of tariffs is expected to have on Thailand’s main exports.
“Under the leadership of President Trump, the United States will have trade policies such as tariffs that may have a negative impact on Thai agriculture exports, and other products such as electronics,” Jirayu Houngsub said, as per Reuters.
Jirayu said that the government last month formed a U.S. Trade Policy Task Force in order “to analyze, strategize, and prepare” for the possible disruptions that the Trump administration could bring about. The group would summarize the pros and cons of any trade and investment negotiations that might eventuate.
Thailand has a particular reason to worry, given Trump’s vow to punish those countries with which the U.S. has significant trade deficits. Last month, Reuters reported that the president ordered federal agencies to complete comprehensive reviews of a range of trade issues by April 1, including analyses of persistent U.S. trade deficits.
The U.S. goods trade deficit with Thailand was $45.6 billion in 2024, an 11.7 percent increase over 2023, according to the Office of the U.S. Trade Representative. Reuters cited statistics from the Thai Commerce Ministry that put the total trade surplus at $35.4 billion.
Thailand’s worries are likely reflective of broader regional sentiment. All but two Association of Southeast Asian Nations (ASEAN) member states (Singapore and Brunei) currently enjoy trade surpluses with the U.S., while the bloc as a whole has a $227 billion surplus with the U.S., mainly from exports of electronics and other manufactured goods. More than half of this is made up of Vietnam’s $123.5 billion surplus with the U.S., the third-largest in the world after China and Mexico. (Thailand’s was the 12th-largest in 2023.)
As Malcolm Cook noted during Trump’s first administration, “the United States’ growing trade deficits and shrinking surpluses with Southeast Asia do bolster an American mercantilist narrative that bilateral deficits are an economic loss for the U.S. caused by Southeast Asian governments’ unfair trade policies.”
While the region got off relatively lightly the first time, there is more reason to be concerned that the Trump administration will take more significant actions to reduce its deficits with major trading partners.
As Reuters reported yesterday, Thailand plans to try to narrow its trade gap with the United States by importing 1 million tonnes of ethane in the second quarter of this year. Whether this gesture of good faith is enough to stave off more concerted action by the Trump administration remains to be seen.
Vietnam has particular reason for unease, given the size of its trade surplus with the U.S., which grew by nearly a fifth in 2024. Its growth has been driven by the rapid industrial development of northern Vietnam, a by-product of the anti-China policies of the first Trump administration, which incentivized a global search for alternatives to Chinese manufacturing. However, there are also suspicions in the U.S. that Chinese firms that have set up factories in Vietnam specifically to avoid tariffs on goods from China, and that this might prompt trade retaliation against the country. Deborah Elms, the head of trade policy at the Asia-based Hinrich Foundation, told Reuters in December that Vietnam “is an ideal candidate for early action because it cannot easily retaliate.”
Last week, after Trump imposed a blanket tariff of 10 percent on all Chinese imports to the U.S., Vietnamese Prime Minister Pham Minh Chinh instructed his Cabinet to prepare for a possible “world trade war.”
But as Joshua Kurlantzick of the Council on Foreign Relations noted last month, Vietnam has been quietly preparing for the possibility of further trade ructions for some time. As he wrote, “They have quietly been advocating to U.S. officials and security experts about the importance of the bilateral strategic relationship,” which has grown considerably over the past decade due to shared concerns about China’s growing power. Hanoi is hoping that its strategic salience for Washington, especially if the Trump administration makes good on its promise to turn its focus from Eastern Europe and the Middle East to the Asia-Pacific, “may ultimately save Vietnam from bearing major economic losses from a second Trump term.”