Trade between Thailand and Cambodia experiences a significant rise in the initial months of 2025, defying the backdrop of ongoing border disputes between the two nations.
In the recent months, border clashes between Thailand and Cambodia have caused significant disruptions to cross-border trade, posing an immediate and potentially long-lasting threat to economic cooperation between the two nations.
The Department of Foreign Trade organized border trade fairs in Nong Khai and Chiang Mai in June and July 2025 to foster new business opportunities. However, these clashes have disrupted vital border trade crossings in key provinces such as Sa Kaeo and Trat in Thailand, causing immediate losses estimated at 40-50 billion baht in border exports within just three months if the conflict persists.
Exports amounted to 596.261 billion baht (up 11.55%), and imports to 425.983 billion (up 12.70%), resulting in a substantial trade surplus of 170.277 billion baht. Key exports in this segment included diesel fuel, other refined oils, and white sugar. Major transit exports included fresh durian, hard disk drives, and rubber products.
Myanmar saw a slight contraction of 1.53% to 105.149 billion baht, while Cambodia, despite its overall growth, accounted for 91.630 billion baht in direct border trade. The ongoing conflict has the potential to severely disrupt future trade between the two countries, risking significant economic losses and long-term shifts in trade patterns.
If tensions continue beyond one month, the combined economic losses for both countries could reach 60.6 billion baht; a two-month continuation could double the loss to over 121 billion baht, and after three months, the damage could total approximately 181.7 billion baht. Prolonged conflict risks permanent damage to export infrastructure, as Cambodia might seek alternative suppliers from Laos, Vietnam, or China, potentially eroding Thailand’s market share in the region.
The clashes have also affected border communities and local economies, with a stark decline in business activity at once-thriving border markets such as Thailand’s Kantharalak District. Vendor numbers and customer traffic have dropped by nearly 80% despite a fragile ceasefire.
Beyond trade, the tourism sector, which relies significantly on the border regions and cross-border visitors, faces substantial risk. A prolonged conflict could cause major shortfalls in tourist numbers, further compounding economic damage.
The ongoing political and military volatility, compounded by nationalist tensions and without robust monitoring or durable ceasefire enforcement, suggests that the uncertainty and disruption in cross-border trade and economic activity could persist, weakening bilateral economic ties and regional integration efforts under ASEAN.
Despite these challenges, the Department of Foreign Trade is taking proactive measures to address trade and investment obstacles along the borders. From September 2025, the department plans to engage directly with stakeholders to support businesses affected by the Thai-Cambodian situation. Six more border trade fairs are scheduled to further promote and boost cross-border trade.
Transit trade to third countries, valued at 516.183 billion baht, was led by China at 314.626 billion baht, followed by Singapore and Vietnam. Among the direct border trade with the four neighbours, Malaysia recorded the highest value at 156.227 billion baht, followed by Laos at 153.054 billion baht. In the first half of 2025, Thailand's total border trade with Cambodia, Laos, Myanmar, and Malaysia reached 1.022 trillion baht, an increase of 12.02%.
References:
[1] The Nation. (2025). Thai-Cambodian border clashes threaten regional integration. Retrieved from https://www.nationthailand.com/news/30407448
[2] Bangkok Post. (2025). Thai-Cambodian border clashes could cost 181.7 billion baht. Retrieved from https://www.bangkokpost.com/business/1936285/thai-cambodian-border-clashes-could-cost-181-7-billion-baht
[3] Reuters. (2025). Thai-Cambodian border clashes threaten regional stability. Retrieved from https://www.reuters.com/world/asia-pacific/thai-cambodian-border-clashes-threaten-regional-stability-2025-07-27/
[4] CNN. (2025). Thai-Cambodian border clashes leave hundreds of thousands displaced. Retrieved from https://edition.cnn.com/2025/07/22/asia/thai-cambodian-border-clashes-displacement-intl-hnk/index.html
[5] South China Morning Post. (2025). Thai-Cambodian border clashes: What you need to know. Retrieved from https://www.scmp.com/news/asia/southeast-asia/article/3146285/thai-cambodian-border-clashes-what-you-need-know
- The ongoing border clashes between Thailand and Cambodia present a significant risk to both nations' economies, potentially causing losses of up to 181.7 billion baht if the conflict persists for three months.
- The Department of Foreign Trade has organized border trade fairs in Nong Khai and Chiang Mai to promote new business opportunities amidst the disrupted cross-border trade.
- The clashes have not only disrupted trade but also affected local economies, particularly border markets, where vendor numbers and customer traffic have dropped drastically.
- If the tensions continue, the tourism sector, which heavily relies on border regions and cross-border visitors, might suffer major shortfalls in tourist numbers, further compounding the economic damage.
- Prolonged conflict could lead to permanent damage to export infrastructure, as Cambodia might seek alternative suppliers from neighboring countries, potentially eroding Thailand’s market share in the region.
- In the business and finance context, continued clashes could lead to significant economic losses and long-term shifts in trade patterns, affecting personal-finance and wealth-management plans.
- Beyond trade and tourism, the general news, crime-and-justice, and accidents associated with the border clashes could potentially escalate, adding another layer of complexity to the already volatile situation.
