Escalating military conflict along the Cambodia-Thailand border has triggered a sharp decline in bilateral trade and fueled a widespread boycott of Thai products in Cambodia. The tensions, which intensified in late May 2025 following the death of a Cambodian soldier on Cambodian soil, have led to armed clashes, economic fallout, and deep public resentment. As trade figures plummet and Cambodian businesses pivot away from Thai brands, the ripple effects of this dispute are reshaping economic ties between the two neighbors.
Border Conflict Sparks Economic Fallout
The Cambodia-Thailand border dispute flared into violence at the end of May 2025, culminating in heavy armed clashes from July 24 to July 28. Reports indicate that Thai forces deployed advanced weaponry, including F-16 fighter jets and cluster munitions, during the confrontations. The intense fighting resulted in significant casualties, damaged infrastructure such as temples, hospitals, and homes, and displaced over 300,000 civilians on both sides of the border. This escalation has not only heightened political tensions but also ignited a strong public backlash in Cambodia against Thailand.
In response, many Cambodians have initiated a grassroots boycott of Thai goods, a movement amplified by a government ban on imports of Thai petroleum, gas, electricity, and internet services. Reports of harassment and discrimination by Cambodians against Cambodian staff working at Thai-branded outlets like PTT fuel stations, 7-Eleven stores, and Amazon Café has further added to public sentiment. This wave of anger has translated into tangible economic consequences, with trade data reflecting a steep decline in bilateral exchanges. 
According to the General Department of Customs and Excise (GDCE) in Cambodia, bilateral trade between Cambodia and Thailand in July 2025 totaled $206.88 million, marking a 13.15% drop compared to July 2024. Exports to Thailand fell by 31.3% to $40.96 million, while imports plummeted 44.1% to $166.19 million. This sharp decline contrasts with June 2025 figures, which showed a more modest decrease of 2.59% to $314.14 million compared to the previous year. The July numbers underscore the immediate economic impact of the border conflict and the ensuing boycott.
Boycott Gains Momentum, But Scale Remains Unclear
The boycott movement has gained significant traction among Cambodian consumers, driven by perceptions of Thai infringement on national sovereignty. Cambodian economist and business consultant Lor Vichet noted a visible drop in sales at popular Thai-branded outlets. “What I have observed generally is that sales at once-popular Thai-branded outlets like PTT fuel and Amazon Café have dropped significantly compared to before the border conflict” he said on August 5, 2025.
However, Vichet cautioned that the full extent of the boycott remains difficult to gauge due to the absence of formal research or surveys on sales trends in Cambodian markets. He emphasized that a comprehensive assessment would require detailed data on the monetary value of imports from Thailand, broken down by product categories, compared to the same period in the previous year. For everyday consumables such as soap, cosmetics, snacks, and noodles, the impact of the boycott is still unclear, pending such data.
Despite the lack of definitive figures, anecdotal evidence suggests a profound shift in consumer behavior. Cambodian business owners have taken decisive steps to distance themselves from Thai brands, with many vowing to terminate contracts with companies like PTT in favor of promoting local alternatives. On August 4, 2025, Tea Siam, a franchisee of PTT Cambodia, announced via a Facebook post the rebranding of all PTT fuel stations nationwide to PPC (Peace Petroleum Cambodia), a Khmer-owned brand. The new logo, featuring five colors symbolizing Cambodian identity and aspirations, reflects a broader push for economic self-reliance amid the ongoing tensions.
Thai Companies Remain Optimistic Despite Challenges
While the boycott and trade decline pose immediate challenges, executives at several major Thai companies express confidence that the situation will stabilize in the near future. Wilaiwan Kanjanakanti, senior executive vice-president of finance at PTT, Thailand’s state-owned energy company, acknowledged the impact of the border dispute on Cambodian consumer behavior. “We are closely monitoring the situation and expect it to return to normal soon. When the situation improves, we will reevaluate and review our business operations in Cambodia” she stated on August 6, 2025.
Kanjanakanti highlighted that while PTT performed well in Cambodia during the first half of 2025, significant impacts are anticipated in the second half due to the boycott. This sentiment is echoed by other Thai business leaders who believe that the current downturn is temporary and tied to the resolution of political and military tensions. Their optimism rests on the historical resilience of Cambodia-Thailand trade relations, which have weathered past disputes, though the current scale of public backlash adds a layer of uncertainty.
Broader Economic Implications for the Region
The decline in Cambodia-Thailand bilateral trade and the boycott of Thai products carry broader implications for regional economic dynamics within Southeast Asia. The two countries have long been important trading partners, with Thailand serving as a key supplier of goods and services to Cambodia. A sustained reduction in trade could disrupt supply chains, particularly for essential commodities, and affect businesses on both sides of the border. For Cambodia, the push to localize supply chains and reduce dependency on Thai imports may spur domestic industries, but it also risks short-term shortages and price increases for consumers.
Economists warn that prolonged tensions could deter cross-border investment and tourism, sectors that have historically bolstered economic ties between the two nations. The displacement of over 300,000 civilians due to the conflict further complicates the economic outlook, as humanitarian needs strain local resources and divert attention from trade recovery efforts. The Cambodian government’s ban on critical imports like petroleum and electricity from Thailand adds another layer of complexity, potentially exacerbating energy costs and connectivity issues within the country.
For Thailand, the boycott represents a challenge to its regional economic influence, particularly in markets like Cambodia where Thai brands have enjoyed significant presence. The rebranding of PTT stations to PPC in Cambodia signals a potential long-term shift in market dynamics, as local competitors seize the opportunity to capture consumer loyalty. Thai policymakers and businesses will need to navigate this delicate situation carefully, balancing military and political strategies with economic diplomacy to rebuild trust with Cambodian counterparts.
Human Cost of the Conflict
Beyond the economic fallout, the human toll of the Cambodia-Thailand border conflict remains a pressing concern. The five-day armed clash in July 2025 left communities on both sides reeling from loss of life, property destruction, and displacement. Reports of damaged cultural and religious sites, including temples and monasteries, have deepened public anger in Cambodia, where such landmarks hold profound national significance. The verbal abuse and discrimination faced by Cambodian staff at Thai-branded outlets further illustrate how the conflict has strained interpersonal relations at the grassroots level.
The displacement of hundreds of thousands of civilians underscores the urgent need for humanitarian assistance and conflict resolution. Families separated from their homes and livelihoods face an uncertain future, while local authorities grapple with providing shelter, food, and medical care. International observers have called for de-escalation and dialogue between the two governments to prevent further suffering and economic disruption.
Looking Ahead: Uncertain Path to Recovery
As the Cambodia-Thailand border conflict continues to reverberate through economic and social spheres, the path to recovery remains uncertain. The boycott of Thai products, while a powerful expression of Cambodian public sentiment, lacks the comprehensive data needed to predict its long-term impact on bilateral trade. Thai companies, buoyed by past experiences of rebounding from regional disputes, remain hopeful for a return to normalcy, but the depth of current tensions suggests that rebuilding trust will require sustained diplomatic efforts.
For now, the focus remains on addressing the immediate humanitarian and economic consequences of the conflict. As both nations weigh their next steps, the question looms: can Cambodia and Thailand find a way to mend not just their borders, but also the economic and cultural ties that have long bound them together?
