Border shutdown batters 6 Northeast provinces, trade losses seen soaring to 80 billion baht

The closure of border crossings between Thailand and Cambodia is inflicting heavy damage on six Northeastern provinces, with initial trade losses estimated at around 50 billion baht – and the bill could climb to 80 billion baht per year if the crisis drags on.

Sorathep Rojpotjanaruch, President of the Restaurant Business Club and Honorary Advisor to the Thai Hostel Association, told that seven months of border tension and prolonged closures have hit Thai exports to Cambodia, which are normally worth about 70 billion baht a year, while imports from Cambodia total only around 20 billion baht.

That means the border shutdown has wiped out roughly 50 billion baht in net trade.

While the impact on Thailand’s overall GDP may be limited – about 0.2% – the damage is highly concentrated in six Isaan border provinces, he said. The Commerce Ministry is now trying to find alternative markets to ease the pain for local businesses.

If the conflict lasts more than three months, estimated trade losses would rise from 50 billion to around 80 billion baht per year, Sorathep warned. If the situation ends within 10–20 days, the fallout should remain manageable, but any longer will sharply increase the risk that Cambodia turns to Vietnamese consumer goods instead. At present, about 80% of Cambodia’s consumer products in this category are imported from Thailand.

On the investment side, Thai businesses in Cambodia are mainly in consumer goods, agriculture and oil. PTT has already withdrawn entirely, so most of the effect is on the private sector, with limited impact on Thailand’s macroeconomy. However, uncertainty may push some foreign firms to relocate production back to Thailand, even though large players have yet to make firm decisions.

Labour is another critical issue. Cambodia is the only neighbouring country whose workers in Thailand are currently not allowed to renew work permits, even though 700,000–800,000 Cambodians work in Thailand each year. The government will need to quickly design alternative mechanisms to avoid labour shortages in services and industry, which rely heavily on foreign workers.

Tourism impacts are relatively localised, such as in Chanthaburi, despite various countries issuing travel advisories for border areas. The main tourism hit is actually coming from severe flooding in the South, which has caused tens of thousands of Malaysian visitors per day to cancel, a blow heavier than the border situation itself.

Residents in the six border provinces are suffering from lost livelihoods and periodic evacuations; most simply want the conflict to end quickly so life can return to normal. Some children have also been affected by repeated school closures during clashes.

On the policy front, some experts argue Thailand should use this moment to crack down on transnational crime networks, especially scam gangs that cause economic losses of tens of billions of baht a year. Countries such as Canada are already losing more than 10 billion baht annually to such scams.

This could put Thailand in a strong position, with international backing, to intensify joint suppression of scam operations while simultaneously addressing border security and stability.