Thailand’s export sector has recorded an impressive 11% year-on-year growth in July 2025, reaching a value of US$28.58 billion and marking the 13th consecutive month of expansion. This surge, driven by a rush to ship goods before new US tariffs took effect, underscores the resilience of Thailand’s economy amid global trade uncertainties. However, looming challenges, including the impact of US import duties and a dramatic collapse in trade with Cambodia due to border closures, threaten to dampen this momentum.
A Surge Driven by Urgency
Thailand’s export performance in July exceeded market expectations, which had forecasted a 9.6% growth rate. According to Poonpong Naiyanapakorn, Director-General of the Ministry of Commerce’s Trade Policy and Strategy Office, the value of exports hit US$28.58 billion, while imports stood at US$28.26 billion, resulting in a trade surplus of US$322.1 million. The primary catalyst for this growth was a last-minute push by international importers to secure Thai goods before the implementation of new US tariffs in August. This urgency particularly boosted the manufacturing sector, with electronics components such as computers and integrated circuits leading the charge.
Industrial exports rose by 14% year-on-year in July, with electronics components surging by 35.2%. Computers saw an extraordinary 61% increase, while integrated circuits grew by 55%. Excluding volatile categories like gold and oil-related products, manufacturing exports expanded by 16.6% year-on-year, accelerating from 15.6% in June. Agricultural exports also contributed significantly, with strong performances in frozen fruit, processed poultry, pet food, and cane sugar. For the first seven months of 2025, Thailand’s total exports grew by 14.4% to US$195.43 billion, reflecting sustained demand for Thai goods on the global stage. 
US Tariffs Cast a Shadow
Despite the robust figures, analysts warn that the introduction of US tariffs in August could halt Thailand’s export momentum. The government remains optimistic, with Poonpong noting that confidence among Thai exporters has been bolstered by assurances of negotiations for a revised tariff rate with the US, alongside support for affected businesses. However, the full impact of these tariffs remains uncertain, particularly for industries like automobiles and auto parts, which face potential competitiveness challenges compared to exporters from Japan and South Korea, who are subject to a 15% duty rate.
The Ministry of Commerce anticipates a moderation in export growth from August onwards but maintains a positive outlook for the year as a whole. Yet, the specter of reduced access to the US market, one of Thailand’s largest trading partners, looms large. Thai exporters, particularly in the industrial sector, may need to pivot to alternative markets or absorb higher costs, potentially squeezing profit margins. The government’s ability to secure favorable trade terms will be critical in sustaining the export-driven economic recovery.
Thai-Cambodia Border Crisis Undermines Regional Trade
While overall exports have flourished, Thailand’s border trade with Cambodia has suffered a catastrophic decline following the closure of all 18 border crossing points in late June 2025. According to the Department of Foreign Trade, bilateral trade values plummeted by 97.5% in July, dropping to a mere 376 million baht (approximately US$10.5 million). Exports to Cambodia fell to 370 million baht, a 97% decrease, while imports collapsed to just 6 million baht, down 99.8%. This drastic reduction contributed to a 20% contraction in Thailand’s overall border trade for the month.
Director-General Arada Fuangtong of the Department of Foreign Trade attributed the collapse to escalating tensions at the border, culminating in clashes between the two sides from July 24 to 28, 2025. These events necessitated the suspension of all vehicle passage, effectively halting trade. The closure has not only disrupted the flow of goods but also strained diplomatic relations, with significant economic repercussions for communities on both sides of the border who rely heavily on cross-border commerce.
Despite the crisis with Cambodia, Thailand’s overall border and transit trade in July reached 166.025 billion baht (approximately US$4.64 billion), a 5% increase year-on-year. Exports in this category totaled 92.216 billion baht, up 5.9%, while imports amounted to 73.810 billion baht, up 3.9%, yielding a trade surplus of 18.406 billion baht (approximately US$514 million). These figures highlight the resilience of Thailand’s broader regional trade networks, even as specific bilateral relationships face severe challenges.
Broader Implications for Thailand’s Economy
Thailand’s export success in 2025 reflects a broader trend of economic recovery and strategic positioning in global supply chains. The manufacturing sector’s strength, particularly in electronics, underscores Thailand’s role as a key player in high-demand industries. The 14.4% year-to-date export growth through July signals robust international confidence in Thai products, despite geopolitical headwinds. However, the reliance on pre-tariff export surges suggests vulnerability to external policy shifts, particularly from major economies like the US.
The Thai-Cambodia border closure, while a localized issue, serves as a stark reminder of the fragility of regional trade dynamics. Border trade, though a smaller component of Thailand’s overall export portfolio, is vital for local economies and small-scale traders. The near-total collapse of commerce with Cambodia could have lasting impacts on cross-border communities, exacerbating economic disparities in Thailand’s peripheral regions. Moreover, unresolved tensions may deter investment in border areas and complicate Thailand’s aspirations to strengthen regional connectivity under frameworks like the ASEAN Economic Community.
Looking ahead, Thailand faces a dual challenge: navigating the fallout from US tariffs and addressing regional trade disruptions. The government’s response will likely involve a mix of diplomatic engagement to reopen border crossings and economic measures to cushion the impact of tariffs. For exporters, diversifying markets and enhancing value-added production could mitigate risks associated with over-reliance on specific trade partners. The automotive sector, already under scrutiny due to tariff differentials, may require targeted support to maintain its competitive edge.
Regional to Global Contexts
Thailand’s export performance must also be viewed within the broader context of Southeast Asian trade dynamics. As countries across the region vie for manufacturing investments amid global supply chain realignments, Thailand’s ability to sustain growth will depend on infrastructure development, labor competitiveness, and policy stability. The US tariffs, while a setback, could accelerate Thailand’s pivot toward markets in Asia and Europe, aligning with regional trade agreements like the Regional Comprehensive Economic Partnership (RCEP).
Furthermore, the Thai-Cambodia border issue highlights the geopolitical risks inherent in Southeast Asia, where historical disputes and political frictions can swiftly disrupt economic ties. Thailand’s leadership will need to balance national security concerns with the economic imperative of maintaining open trade routes. Collaborative efforts with Cambodia to de-escalate tensions and restore border access will be essential to prevent long-term damage to bilateral relations and regional stability.
As Thailand celebrates 13 months of consecutive export growth, the road ahead is fraught with uncertainty. The impact of US tariffs, now in effect, will test the resilience of Thai exporters and the government’s negotiating prowess. Simultaneously, the fallout from the Thai-Cambodia border closures demands urgent attention to prevent further economic and social harm. How Thailand navigates these twin challenges will shape its economic trajectory in the latter half of 2025 and beyond, with implications for both domestic prosperity and regional influence.
