Thailand’s GDP growth this year may drop to 1.5-1.8% and export growth may shrink to zero, year on year, losing its competitiveness to Vietnam, if the country is hit with the full 36% reciprocal tariff by the US for more than six months, or faces a higher tariff than Vietnam, according to the worst-case scenario forecast by Krungsri Research.


Krungsri Research said that Thailand’s exports in March, estimated at US$29.5bn, were the highest in recent history, due to a jump in orders for Thai products from US importers in an attempt to avoid the reciprocal tariff, which was suspended for 90 days by the Trump administration.


Major export items which saw substantial increases include computers and accessories (+80.2%), circuit boards (+41.5%), rubber (+19.5%), air conditioners and accessories (+19.1%), machinery and accessories (+17.3%) and automobiles and accessories (+5.6%).


Thailand’s export value for the first quarter registered a 15.2% increase, to US$81.5bn.


Krungsri Research said Thailand would be the only ASEAN member to see its growth below 2% this year, in the worst case scenario.


Krungsri Research set three scenarios for the Thai economy, vis-à-vis the US tariffs. In the first scenario, if Thailand faces a 10% tariff for the whole year, Thailand’s GDP growth is projected to be 2.2-2.4%. If the 36% tariff rate is imposed for 3-6 months, Thailand’s GDP growth is projected to be 1.9-2.1%.


In the worst case scenario, if the 36% tariff rate is imposed for longer than six months, Thailand’s GDP growth will shrink to 1.5-1.8%, said Krungsri Research.

Thailand’s GDP may shrink if US 36% tariffs persist over six