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Here is your Mekong Memo Thailand for this week.
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Headlines:
US Academic's Detention Sparks Outrage
Tariffs Threaten To Upend the Economy
Efforts to Balance US Trade
Chinese Goods Flood Local Markets
ASEAN Forms Geoeconomic Task Force
Thailand in Post-Earthquake Construction Mess
State Audit Office Building Collapse Investigation
Chinese Railway Companies Under Scrutiny
SET Tries to Tamp Market Volatility
EV Strategy Promotion Advances
Casino Legalization Postponed
Adults Hit with Ban on Corporal Punishment
Biometric System for Undocumented Migrants
Digital Regulations Updated
Legal Dispute Halts Nescafé Production
Mortgage Rejections on the Rise
IMF Urges Financial Security Measures
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US Academic's Detention Sparks Outrage
Paul Chambers, a 58-year-old American lecturer at Thailand's Naresuan University specializing in Thai military politics, has been charged under the lèse-majesté law and Computer Crimes Act for alleged royal insults during a 2024 webinar. The US State Department expressed alarm after Chambers was initially denied bail as he was considered a flight risk. Chambers' wife contests the evidence. The case is another in a list of more than 270 lèse-majesté charges filed since 2020, with scholarly organizations suggesting the charges are intended to discourage his research into the military. Chambers has since been released on bail but faces visa revocation and deportation, with a House committee hearing scheduled for April 17.
Read more: Al Jazeera (Detention), BBC (Warrant), Nation Thailand (Academic Freedom), Irish Star (Punishment Details), Thai Examiner (Bail Release)
Tariffs Threaten To Upend the Economy
The US has placed a 36% tariff on Thai goods with a 90-day timer running for negotiation, a move that threatens to reduce Thailand's GDP growth from 2.9% to below 2%. The Federation of Thai Industries is warning of 900 billion baht ($25.8B) revenue losses affecting the automotive, food processing, electronics, and textile industries. Thailand plans to negotiate by increasing US imports of energy, aircraft, and agricultural products while reducing import taxes. The Ministry of Finance is preparing 3 billion baht in soft loans for affected businesses. Economists are saying that monetary policy adjustments will be required, with Bank of America foreseeing three interest rate cuts to 1.25% over the coming 12 months.
Read more: CIMB Thai Bank (GDP Revision), VnExpress (Industry Impact), Thai Enquirer (Economic Analysis), Investing.com (Rate Forecast)
Efforts to Balance US Trade
Thailand has pledged to increase United States imports by as much as $32.9 billion, targeting energy, aircraft, and agricultural products, to address its $45.6 billion trade surplus. Finance Minister Pichai Chunhavajira will lead discussions with US trade representatives, proposing higher purchases of American corn, soybeans, LNG, crude oil, and electronics. Thai Airways' commitment to purchase 45 Boeing 787-9 jets is a substantial pillar of this strategy. Officials are taking a measured approach, saying they want to find a "middle path" distinct from China's more confrontational stance, while bringing the US trade deficit ratio to 20%.
Read more: Bangkok Post (Import Strategy), Investing.com (Tariff Response), Detroit News (Measured Approach), Bangkok Post (Strategic Initiative)
Chinese Goods Flood Local Markets
The US-China trade war is pushing Chinese manufacturers to redirect products to Thailand and Southeast Asia, with Chinese goods generally priced 20-40% below the cost of Thai equivalents. A Federation of Thai Industries survey shows seven in 10 respondents are worried about losing market share, with 62% asking for government intervention through legal enforcement and Anti-Dumping Act rules. Thai companies are being told to focus on high-quality eco-friendly materials and technological improvements to remain competitive. The story is being played out on e-commerce platforms as well, where platforms like Shopee, Lazada, and TikTok Shop have become avenues for Chinese exporters to get around trade restrictions by rerouting goods through Southeast Asian countries.
Read more: Bangkok Post (Market Impact), Bangkok Post (E-Commerce Concerns)
ASEAN Forms Geoeconomic Task Force
ASEAN has formed a Geoeconomic Task Force to manage US trade relations. The force will monitor US policy effects, improve public-private collaboration, and develop opportunities as they arise. Current US-ASEAN trade stands at $477 billion as of 2024, making the US ASEAN's second-largest trading partner. This comes as the ISEAS – Yusof Ishak Institute's annual Southeast Asian survey shows climate change has come out on top as the region's primary concern (the survey was done before the latest market disruptions), while South China Sea tensions remain highly important. Though China kept its position as the most influential economic regional power, the United States was named as the most trusted major power and preferred strategic partner.
Read more: Bangkok Post (Task Force), ISEAS (Regional Survey)
Thailand in Post-Earthquake Construction Mess
The construction sector faces a mixed outlook following recent earthquakes, with damage estimated at 30 billion baht. The SCB Economic Intelligence Center reports that while the sector may benefit from increased repair work, it faces new challenges including stricter contractor selection processes and tighter building safety requirements. The condo sector, accounting for 15-17% of total construction value, is expected to see slower activity. The insurance industry faces an estimated 100 billion baht in claims, and is likely to result in separation of earthquake coverage from traditional fire insurance policies as well as higher premiums. Residents are sharing growing concerns about building safety, with increased demand for low-rise and earthquake-resistant properties.
Read more: Bangkok Post (Construction Outlook), Bangkok Post (Insurance Impact), Bangkok Post (Real Estate Shift)
State Audit Office Building Collapse Investigation
Authorities have questioned 98 people in the State Audit Office building collapse investigation, including company employees, victims' relatives, eyewitnesses, and survivors. The disaster has resulted in 22 confirmed deaths, with 72 people still unaccounted for. The Senate Committee is investigating foreign business law violations, especially allegations that China Railway No. 10 used Thai nominees. The Treasury and Interior Ministry are saying they will begin discussions to reform government procurement contracts, strengthening contract safeguards and setting clearer accountability measures. The Chinese Embassy has expressed support for a thorough investigation while defending Chinese companies against alleged smear campaigns.
Read more: Bangkok Post (Investigation Update), Nation Thailand (Contract Reforms), Nation Thailand (Chinese Embassy Statement)
Chinese Railway Companies Under Scrutiny
An investigation has shown 23 Chinese companies registered in Thailand under the "China Railway" banner, collectively holding 5.71 billion baht in registered capital. These companies typically feature Chinese capital networks with Hong Kong investors, while having Thai national directors and Chinese shareholding of between 40-49%. China Railway No. 10, registered in 2018 with 100 million baht capital, stands out for securing 27 government contracts in excess of 10 billion baht, though it reported a 199,669,872 baht net loss in 2023. The Department of Special Investigation has said that China Railway No. 10 allegedly used three Thai nationals as nominees to mask foreign ownership since it was set up.
Read more: Nation Thailand (Company Network), Khao Sod English (Nominee Allegations)
SET Tries to Tamp Market Volatility
The SET Index dropped 4.5% on concerns over US trade policy, prompting the Stock Exchange of Thailand to implement protective measures against market volatility. The exchange's circuit breaker system is set to halt trading for 30 minutes if the index falls 8%, with further cool-down suspensions triggered at 15% and 20% drops. The SET has temporarily banned short selling and tightened market mechanisms, with restrictions on ceiling and floor price limits at ±15% from the normal ±30%. The measures are expected to be lifted on April 16, with the SET reporting that most listed companies remain fundamentally strong despite the index seeing a 17.3% year-to-date drop.
Read more: Bangkok Post (Market Drop), Bangkok Post (Protection Measures), Bangkok Post (Restriction Timeline)
EV Strategy Promotion Advances
The government wants to position the country as an EV manufacturing hub through policy initiatives. The plan includes the EV3.0 and EV3.5 schemes offering tax incentives, with excise tax reductions from 8% to 2% and import tax cuts ranging from 20-40%. Consumer subsidies between 50,000-150,000 baht are also being put in place. The strategy will include support for hybrid and plug-in hybrid vehicles during the transition period, with tax incentives linked to CO2 emissions. Tax rates of 5-10% will apply based on electric range and fuel tank specs.
Read more: Bangkok Post
Casino Legalization Postponed
The Cabinet has temporarily postponed the Entertainment Complex Bill, which would form a framework for casino licensing. The legislation would allow casinos within entertainment complexes, limiting gambling areas to 10% of total space and requiring a minimum THB 100 billion investment per complex. Thai nationals would face a 5,000 baht entry fee and were expected to need to maintain a THB 50 million bank deposit to gamble. The bill is seeing stiff opposition from religious organizations, who warn of potential moral deterioration, gambling addiction, money laundering, and human trafficking risks. The delay is being sold as a way to provide time for negotiations and to avoid immediate political confrontation, with a showdown expected in three months.
Read more: Yogonet (Bill Postponement), Economic Times (Economic Context), Nation Thailand (Religious Opposition), Asian News Network (Political Tensions)
Adults Hit with Ban on Corporal Punishment
Legal reform banning all physical punishment of children through an amendment to Section 1567 of the Civil and Commercial Code has been enacted. The amendment replaces parents' "right to punish" with the directive to "reprimand and educate with reason," prohibiting cruel, harmful, or inappropriate physical and mental punishment in homes, schools, and care institutions. The reform comes alongside positive trends in reducing violent discipline, with rates dropping from 75% in 2015 to 54% in 2022. Thailand joins 67 other nations with similar bans, following pioneers like Sweden (1979) and Finland (1983).
Read more: Nation Thailand
Biometric System for Undocumented Migrants
The National Communicable Disease Committee has approved a biometric authentication system to manage the country's undocumented migrant population. The system, developed in collaboration between the Thai Red Cross Society, Department of Disease Control, and NECTEC, will use facial recognition and iris scanning technology to create identity records. Of Thailand's 5+ million foreign nationals, more than a million lack proper documentation. The system will improve public health services, disease surveillance, and control while allowing undocumented migrants to access healthcare and emergency assistance.
Read more: Nation Thailand
Digital Regulations Updated
The Electronic Transactions Development Agency has issued revised draft regulations expanding oversight of online marketplace operators to include medical devices, herbal products, and hazardous substances under Thai FDA supervision. Digital platform operators set up local entities in Thailand and report metrics on regulated goods and complaint handling. The compliance timeline has been extended to 120 days post-Gazette publication. The government is also expected to amend two emergency decrees targeting cybercrime and digital asset transactions. Main changes in the decrees are to set more accountability for financial institutions in scam-related losses, and the introduction of an immediate refund mechanism for proven cybercrime victims without court proceedings.
Read more: Tilleke & Gibbins (Regulations), Bangkok Post (Cybercrime)
Legal Dispute Halts Nescafé Production
A court injunction issued by the Minburi Civil Court on April 3, 2025, has brought a stop Nescafé's manufacturing, distribution, and import operations in Thailand following a legal dispute between Nestlé and Quality Coffee Products Co., Ltd (QCP). The dispute began with Nestlé's termination of a production rights contract with QCP, a 50/50 joint venture that has manufactured Nescafé products since 1990. While an international arbitration confirmed the contract termination effective December 31, 2024, QCP's Chalermchai Mahagitsiri filed a lawsuit leading to the injunction. Nestlé has invested nearly 23 billion baht in Thailand, and plans to challenge the injunction.
Read more: Khao Sod English
Mortgage Rejections on the Rise
The mortgage market has seen rejection rates climbing from 40% in Q4 2024 to 45% in Q1 2025. The most severely affected segment is homes priced between 1 and 3 million baht, with rejection rates hitting 70%, while mid-range properties (3-7 million baht) are notching 40% rejection rates. Main reasons include poor borrower financial history, high debt, and insufficient income documentation. The government has approved reductions in property-related fees to support the struggling real estate sector, cutting ownership transfer and mortgage registration fees to 0.01% for residential properties valued up to 7 million baht, effective through June 2026. Officials expect this will boost residential unit transfers by almost 10% year-on-year.
Read more: Bangkok Post (Mortgage Challenges), Bangkok Post (Fee Reductions)
IMF Urges Financial Security Measures
The IMF has issued recommendations for Thailand to shore up household financial security against high debt levels. With more than 50% of Thai workers in informal employment, many are vulnerable to economic shocks and often borrow for basic expenses. The IMF says there is a need for balanced debt solutions including simplified personal debt resolution processes and accessible bankruptcy systems. Recent projects to address the issue include the "You Fight, We Help" debt relief program (December 2024) and the Bank of Thailand's responsible lending guidelines (January 2024). Thai households are spending an average of 21,027 baht monthly, with housing and utilities making up the largest share at ~25% (5,183 baht), followed by transportation and communication at ~23% (4,731 baht).
Read more: Bangkok Post (IMF Recommendations), Nation Thailand (Household Spending)
That’s it for this week, thanks for reading!
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