According to Kiatnakin Phatra Securities (KKPS), the International Monetary Fund’s (IMF) April 2026 World Economic Outlook lists Thailand among only four economies—alongside South Korea, Taiwan, and Malaysia—well positioned for AI hardware exports.
The sector encompasses enterprise hard disk drives (HDDs) and storage, optical transceivers, servers and electronic manufacturing services (EMS), power electronics, and outsourced semiconductor assembly and test (OSAT). This positions Thailand within a major global capital expenditure cycle driven by AI.
In the first five months of 2026, Thai exports grew 17% year-on-year, highlighted by electronics surging 50.6% and shipments to the United States rising 40.3%. U.S.-bound shipments now represent nearly a quarter of Thai exports. While this growth mirrors trends seen in Taiwan, Thailand is not seeing the same broad-based economic lift.
Despite strong export growth, Thailand’s trade deficit has widened to $25.2 billion so far this year. Manufacturing output, adjusted for value added, declined 0.8% year-on-year—even as electronics exports soared. Imports jumped 35.6% over the same period, with electronic parts more than doubling.
The resulting tech sector trade deficit and lower local production suggest much of the export surge reflects transshipment, higher imported inputs, and data center-related import demand—leaving limited domestic value retention.
KKPS stated that a K-shaped pattern is evident within Thai manufacturing. Growth is concentrated in sectors like HDDs, electrical equipment, and food and beverages, which make up about 35% of manufacturing. The remaining 65%—including autos and petrochemicals—continues to contract, with auto production down 15% year-on-year and legacy industries struggling against Chinese overcapacity.
Ultimately, the positive effects of the AI hardware export boom are insufficient to offset broader weakness in the majority of Thailand’s manufacturing sectors. While lifted by tech, Thailand’s overall economic outlook remains restrained by underperformance in autos and legacy industries, putting ongoing pressure on production, the current account, and the baht through 2026.
