Bangkok: Alongkorn Ponbutr, President of the FKIII Institute and former Vice President of the National Reform Council, has sounded the alarm for the Thai government to swiftly address the impending economic challenges following a significant ruling affecting US trade policies. The ruling by the US Supreme Court, which determined that President Donald Trump exceeded his authority in imposing tariffs under the International Emergency Economic Powers Act (IEEPA), is expected to cause a ripple effect that will severely test Thailand's economic resilience.
According to Thai News Agency, Mr. Alongkorn's analysis, titled "The Second Wave Hits the Thai Economy After Trump's Tax Case Loss," highlights the potential repercussions on Thai-US trade relations. The decision represents a major setback for Trump's "America First" economic agenda and could lead to a broader imposition of tariffs, including a newly announced 10% levy on global imports under Section 122 of the Trade Act of 1974. This development demands urgent government action to mitigate the anticipated economic strain on Thailand in the coming year.
The analysis outlines key issues, including the potential for the US government to refund $130 billion to $160 billion in previously collected taxes, a move that would pressure the US fiscal position. Additionally, the persistence of trade uncertainties, even after the court ruling, is expected to keep businesses worldwide on edge as they navigate shifting regulations and counter-actions from the US administration.
The trade dynamics are particularly concerning for Thailand, the US being its top trading partner. Trade statistics indicate a total trade value of approximately US$93,650 million in 2025, with Thailand exporting US$72,510 million to the US, marking a 12.9% increase and highlighting a significant trade surplus. This situation leaves Thailand vulnerable to scrutiny and potential tariff implications from the US.
The ongoing trade crisis, exacerbated by Trump's immediate implementation of a baseline 10% tariff, poses a looming threat to the Thai economy. Financial institutions, including the Bank of Thailand and Kasikorn Research Center, have revised economic forecasts, anticipating a substantial decrease in Thailand's export value and a GDP growth slowdown to between 1.5% and 1.9% for 2026.
High-risk sectors include electrical and electronic appliances, machinery, rubber products, automotive parts, and jewelry, all facing significant challenges due to the new tariffs. However, a potential silver lining lies in the possible tax refunds for US importers of Thai goods, which could offer short-term relief to Thai manufacturers.
In conclusion, while the court's ruling reduced the tariff ceiling to 10%, the broad application of tariffs across most product categories means that Thailand must strategically adapt to mitigate risks. Exploring new markets and accelerating free trade agreements with other regions are crucial steps to stave off severe economic impacts in the future.