The Kasikorn Research Center views the "America First Trade Policy" as a shift in U.S. trade direction, increasing uncertainty in the global economy through expanded import tariffs from China to multiple countries, leading to tariffs on various nations worldwide and across many industries. This has resulted in high uncertainty for the global economy and trade. In 2026, significant events will impact trade direction, such as meetings between Chinese and U.S. leaders, a review of the revised free trade agreement between the U.S., Mexico, and Canada (United States-Mexico-Canada Agreement: USMCA), and monitoring court decisions regarding the use of IEEPA (International Emergency Economic Powers Act) to determine whether tax policies will be invalidated. The U.S. has implemented import tariffs to protect domestic industries. Thailand must expedite free trade agreements (FTAs) with the European Union (EU) and the U.S. to avoid disadvantages, especially in the jewelry and accessories industry, which competes directly with India.

Mr. Burin Adulwattana, Managing Director and Chief Economist of Kasikorn Research Center stated that President Donald Trump's announcement of the "America First Trade Policy" represents a change in U.S. trade policy that not only affects the structure of global trade but also accelerates countries' need to adjust their strategies significantly in terms of geopolitics and supply chains. Measures targeting China have expanded to include import tariffs on various countries worldwide and across multiple industries, resulting in high uncertainty for the global economy and trade.

Over the past year, President Donald Trump has used security and political reasons to enforce both reciprocal tariffs and product-specific tariffs under Section 232. Additionally, he has pursued geopolitical policies based on the Monroe Doctrine, viewing both North and South America as U.S. spheres of influence, as reflected in the imposition of reciprocal tariffs on most Latin American countries at a rate of 10%, while Brazil faced a 50% tariff due to political reasons.

However, the America First Trade Policy has not had as severe an impact on global trade, the world economy, and the U.S. economy as anticipated. This is partly because the measures have a delayed implementation (starting in August 2026), and most countries have not raised import tariffs in retaliation against the U.S. government.

Regarding the impact of U.S. trade policies, although the value of exports from China to the U.S. decreased by about 20% last year, overall, China's exports have continued to grow well, achieving a trade surplus of $1.2 trillion, the highest on record. China has expanded its exports to other regions, such as ASEAN, the EU, and Africa, partly reflecting transshipment issues to avoid tariffs.

China has responded to U.S. tariff measures due to its advantage over the U.S. in holding Rare Earth and Critical Minerals, resulting in China nearly monopolizing the global supply chain, which is crucial for the U.S. in terms of strategic and economic security. In addition to reciprocal tariffs, the U.S. has also implemented Section 232 measures to impose product-specific tariffs on items such as steel, aluminum, automobiles and parts, semiconductors, and in the future, there is a tendency to impose import tariffs on drugs and medical supplies to encourage reshoring and increase employment in the manufacturing sector. This has led leading companies in various industries, such as semiconductors, automotive, and steel, to announce plans for increased investment in the U.S.

Nevertheless, over the past year, employment in the industrial sector has continued to contract, with only certain industries, such as metal processing (especially steel), experiencing job growth.

In 2026, significant events that will determine the future direction of global trade include:

  • A meeting between President Xi Jinping and Trump in April
  • Court decisions regarding the use of IEEPA to determine whether tax policies will be invalidated
  • Review of the USMCA agreement in July
  • U.S. midterm elections
  • The end of tariff retaliation between China and the U.S. will be effective until November

While America builds walls, other countries are building bridges. While the U.S. uses import tariffs to protect domestic industries, other countries are accelerating trade agreements with each other. For example, India was able to reach an agreement with the European Union (India-EU FTA) within a few months after 20 years of negotiations and has also reached an agreement with the U.S., allowing India to benefit significantly from the America First Trade Policy.

For Thailand, the key issue to watch is the impact on industries that Thailand exports to compete directly with India in the U.S. and the EU, particularly the jewelry and accessories industry, as Thai exports are at a disadvantage compared to India due to the lack of a free trade agreement with the EU. In the future, the Thai government must expedite trade agreements with the EU and the U.S. as soon as possible.