The defeat of President Donald Trump followed the 20 Feb 2026 U.S. Supreme Court ruling that the use of authority under the International Emergency Economic Powers Act (IEEPA) to impose retaliatory tariffs was invalid, requiring refunding tariffs already collected from importers.
This did not end the "trade war" but instead sparked new uncertainty and global economic trade risks, as Trump immediately retaliated by announcing a blanket 10% import tariff on goods from all trading partners for 150 days, effective from 24 Feb to 24 Jul 2026, to protect trade and national security. This relied on authority under Section 122 of the Trade Act of 1974 to address severe trade deficits. Just one day later, Trump raised the tariff rate to 15%.
As a result, during these 150 days, goods from various countries entering the U.S. face a new complex tariff structure combining normal Most Favored Nation (MFN) import duties, anti-dumping and countervailing duties (AD/CVD) applied unevenly by product and country, plus the new 10-15% tariffs.
However, certain agricultural and industrial products that the U.S. lacks were exempted from the 10-15% tariffs, including products under Section 232 of the Trade Expansion Act of 1962, which retain their original rates: steel, aluminum, copper and related products at 50%; automobiles and parts at 25%; wood and related products at 10-25%; medium and heavy trucks at 10-25%; and semiconductors at 25%.
Although the 10-15% tariffs for the next five months temporarily level the playing field in the U.S. market, new concerns focus on what strategies Trump will use after the 150 days expire, since Section 122 is merely a "buying time" measure to develop new "trade weapons" to impose tariffs globally.
The economic team delves into the "weapons" President Trump may wield, which will determine global and Thai trade and economic outcomes, including approaches for negotiations with the U.S. and long-term survival strategies amid risks such as geopolitical issues, U.S.-Iran tensions, fluctuating energy prices, and exchange rates.
Preliminary analysis shows that the 10-15% tariffs under Section 122 benefit Thailand, which previously faced a 19% retaliatory tariff, making Thai goods cheaper and more attractive to U.S. consumers, possibly increasing imports. This is a golden opportunity for U.S. importers to accelerate purchases from Thailand, similar to the period before retaliatory tariffs took effect.
Thailand also benefits from exemptions under Section 122 for products such as tropical fruits, fruit juices, processed foods, tapioca starch, computer parts, electronic components, hard disk drives, latex, and plastic products, totaling 1,654 items with export value over 6.3 billion U.S. dollars.
At the same time, other countries also see temporary tariff reductions, particularly key competitors like China and Vietnam, previously subjected to 44% and 20% tariffs respectively, and India with 18%. These countries also benefit from exemptions. This situation may cause previous customers of these countries, who shifted some purchases to Thailand due to lower retaliatory tariffs, to revert, potentially causing Thailand to lose market share.
The Office of Trade Policy and Strategy (OTPS) assessed impacts on Thailand's top 30 exported items to the U.S. based on tariff changes, categorizing them into four groups: 1. Products with potential and opportunity where Thailand gains advantage due to a 4% tariff reduction, unlike competitors such as Japan, South Korea, and Taiwan who start with a 15% tariff. Products include diamonds, machinery parts, integrated circuits, printers, monitors, motorcycles, and heavy machinery.
2. Vulnerable products at risk of losing market share as competitors gain greater tariff reductions—Mexico by 10%, Canada 20%, China and Vietnam 5%. Examples include smartphones, computers, air conditioners, automotive parts, electrical control panels, furniture and parts, radio or television transmitters, and plastic flooring.
3. Products under watch for potential non-tariff trade protection measures aimed at curbing abnormal import surges or suspected shifts of production bases from China, including semiconductors, solar cells, transformers, and tires. 4. Price- and currency-sensitive products such as rice, pet food, processed fish and canned tuna, rubber gloves, natural rubber, and fresh and processed fruits.
OTPS also proposed strategies to maintain advantages and market share: for the first group, proactive market expansion through intensified sales promotion and long-term contracts to secure customers; for the second, upgrading value chains to avoid price wars with China and Mexico, targeting premium markets and sustainability standards (ESG).
For the third group, building transparency immunity, increasing local content ratios, and establishing traceability systems to prevent counterfeit products, preparing to respond to AD/CVD allegations and counterfeit claims. For the fourth group, managing financial risks alongside production cost control throughout the supply chain to maintain profit margins amid price competition.
During the 150-day "buying time," what new U.S. trade laws and tariffs can President Trump deploy?
Krungsri Research notes that after the general tariffs under Section 122 are imposed for five months, any continuation requires Congressional approval, which may be difficult. However, Trump holds other options, including three tariff types: 1. Additional import duties under Sections 201 and 301 of the Trade Act of 1974, the same law used to impose the 15% tariff.
2. Tariffs under Section 338 of the Tariff Act of 1930, a nearly century-old measure applicable up to 50%, and 3. Section 323 under the Trade Act of 1962, used to counter imports posing national security risks.
The highest risk for Thailand lies with additional import duties under Sections 201 and 301, aligning with the Thai Ministry of Commerce's view that Section 301 is a key measure likely to be used, requiring preparation. Section 301 of the 1974 Trade Act allows long-term retaliatory measures or tariffs. Trump has ordered the U.S. Trade Representative (USTR) to expedite investigations into unfair trade practices by trading partners.
This corresponds with USTR Ambassador James Greer's 26 Feb 2026 statement that Section 301 will replace previous retaliatory tariffs and serve as a tool to enforce compliance with trade agreements, targeting countries overproducing industrial goods, employing forced labor, discriminating against U.S. tech companies, or subsidizing products like rice, seafood, and others.
Section 301 tariffs are applied selectively by country and product, unlike blanket retaliatory tariffs. Currently, Thailand is under special Section 301 scrutiny for intellectual property violations and was listed in 2025 by USTR as a Watch List (WL) country, but no tariffs or pressure measures have been imposed yet.
Attention focuses on whether Thailand will remain on the WL in this year's review, with results expected in April, and whether the U.S. will apply pressure measures. In 2025, Thailand recorded a historic $71.856 billion trade surplus with the U.S., up $26.364 billion from 2024, ranking 7th among countries with the largest U.S. trade surpluses (up from 11th). Thailand also has yet to reach trade agreement outcomes with the U.S.
Additionally, Section 232 tariffs affecting national security apply to ongoing investigations on minerals, medicines, and medical equipment. Section 338 of the Tariff Act of 1930 targets countries discriminating against U.S. trade. Section 201 allows temporary import duties to protect domestic industries from increased imports (Global Safeguard). AD/CVD measures have already been applied to Thai products like solar panels, truck chassis, silicon metals, refrigerators, and freezers.
However, in crisis lies opportunity. Certain Thai product groups are not subject to these measures, while competitors are, giving Thailand an advantage. Thailand could also revive negotiations on the Anti-Retaliatory Tariff (ART) text, focusing on market access and reducing or removing trade barriers, independent of tariff rates as during previous retaliatory tariff negotiations. The U.S. demands Thailand open 99% of traded products and eliminate trade barriers.
Overall, Thailand faces high risks of increased tariffs due to its large trade surplus, scrutiny as a transit point for Chinese goods, or goods transshipped and falsely declared as Thai origin (Circumvention), and blanket tariffs under Sections 232 and 201.
Concerns arise that if the U.S. imposes tariffs under Sections 301, 201, and 232 on Thailand, high tariffs could persist long-term since laws allow tariff extensions, resulting in prolonged trade impacts. Thai products at risk include solar panels, tires, electronic parts, steel and related products, automobiles and parts, and electrical appliances.
For Thai exports this year, the Ministry of Commerce forecasted in late 2025 growth between 1.1% and contraction of 3.1%, valued at $337.655-$323.628 billion, due to the 19% retaliatory tariffs and a high base in 2025. If the U.S. adopts stricter measures with higher tariffs, impacts could worsen, affecting employment in vulnerable sectors and indirectly impacting SMEs due to increased Chinese goods influx into Thailand.
Recently, Prime Minister Anutin Charnvirakul instructed Deputy Prime Minister and Finance Minister Aneknithi Nitithanprapas and Commerce Minister Supachai Sutthumpun to closely monitor the situation, coordinate negotiation teams, develop maximum mitigation measures, and proceed with negotiations with the U.S. to maintain ongoing trade and investment relations.
Simultaneously, measures to reduce impacts on businesses are needed, including seeking new export markets, expediting ratification of Free Trade Agreements (FTAs) with Sri Lanka, Bhutan, and the European Free Trade Association (EFTA), accelerating pending FTAs, and fast-tracking approved investments by the Board of Investment (BOI) to inject capital into the economy.
OTPS assesses that Thailand must shift from merely "defending against trade barriers" to "building value chains and strategic alliances" to ensure long-term trade security with the U.S. in four areas: 1. The government continues U.S. trade negotiations to preserve trade and investment relations while closely monitoring U.S. policies to prepare timely responses.
2. Utilize Thailand's strategic role in ASEAN to foster supply chain cooperation, upgrade joint production standards, and maintain the region's manufacturing hub status. 3. Enhance credibility from a "neutral trade partner" to a "trusted ally" and "strategic economic partner" by aligning domestic regulatory systems with international standards, enforcing trade laws, and establishing supply chain traceability to reduce risks of counterfeit claims. 4. Maintain strategic balance amid great power geopolitical competition.
Economic Team
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