It is not the sole issue facing the nation at present, however. Geopolitical tensions are rising both locally and globally, and the pressure on the future of the Thai economy is immense. The United States has introduced 19% tariffs on Thai exports, whilst clashes along the Cambodian border in July have displaced thousands of workers from industries including construction, disrupting a key source of migrant labour, and putting added strain on the Thai economy.
Findings from the latest Grant Thornton International Business Report (IBR) reflect the impact of these pressures through the sentiment and behaviours of business leaders. Business optimism in Thailand declined from 57% in Q1 of 2025 to 38% in Q2, the lowest since the COVID-19 pandemic. Furthermore, plans for businesses to invest in the workforce, technology and capacity have also decreased at a time when investment is crucial to drive productivity and help mitigate the demographic crisis.
When a pause in investment meets a shrinking workforce, productivity will inevitably weaken, and the path back to growth will become longer. Thailand’s business and political leaders must understand that it is no longer an emerging market, but a mature economy. As such, it needs to prioritise increasing productivity to boost GDP, by embracing greater workforce flexibility, accelerating the usage of technology, and investing in new high-value industries. Political stability is also crucial, as without it, businesses as seen in the IBR findings will lack the confidence to invest in the solutions that will define future success.
