Conducted with fieldwork in January 2025 and a follow-up survey in April 2025, the study highlights a cautious yet resilient business community adapting through regional pivots, digital transformation, and sustainability efforts. The study found that after US tariffs were announced, more than 90 per cent of businesses expect to see more disruptions on supply chain management. 68 per cent expect faster digitalisation adoption while 60 per cent view sustainability as important with the US tariffs driving urgency.
Mrs Vira-anong C. Phutrakul, Deputy CEO and Head of Wholesale Banking, UOB Thailand said "The UOB Business Outlook Study 2025 (Thailand) underscores the resilience of Thai businesses as they adapt to global challenges. By pivoting to regional opportunities, embracing digital tools, and prioritising sustainability, businesses are charting a path to long-term growth. UOB is committed to supporting them with tailored financial solutions, local trade expertise, and established network in the ASEAN region."
US tariffs dampen confidence, spur action
The study finds that business sentiment, dropped from 58 per cent in 2024 to 52 per cent following US tariff announcements in April this year, with small enterprises feeling the most pessimistic. Rising operational costs and inflation are top concerns, with 60 per cent of businesses anticipating cost pressures and 57 per cent expecting higher inflation in Thailand. Real estate and hospitality sectors are particularly hard-hit.
According to the study, Thai businesses are taking decisive steps:
- Cost-cutting: Three in five businesses, led by medium enterprises (67 per cent), have implemented cost-saving measures.
- Revenue growth: Many are seeking new customer bases and strategic partnerships.
- Areas of support: Businesses prioritise financial aid (92 per cent), trade and supply chain support (65 per cent), and consultancy/training (50 per cent) to build resilience.
Supply chain strains drive regional focus
With 90 per cent of businesses emphasising supply chain management (SCM), US tariffs have intensified disruptions, with 80 per cent anticipating further challenges due to inflation and high interest rates. In order to stabilise operations, Thai businesses are looking towards:
- Data analytics: Four in 10 businesses are leveraging analytics for faster decision-making, overtaking diversification as the top SCM strategy in 2024.
- Intra-ASEAN trade: Companies are shifting to regional alternatives, boosting regional trade.
- Areas of support: Tax incentives, technology access, and workforce training are critical needs.
Digitalisation accelerates resilience
Digital adoption is a key pillar, with nearly 40 per cent of businesses fully integrating digital tools. Post-tariffs, 68 per cent expect faster digitalisation adoption, particularly among medium enterprises. Benefits include improved customer engagement, reach, and speed to market. However, cybersecurity, costs, and data breach risks remain concerns, driving demand for training and industry-specific analytics.
Sustainability gains urgency but faces hurdles
More than 90 per cent of businesses view sustainability as important, but only 53 per cent have adopted practices, with medium enterprises trailing. Post-tariff, more than 60 per cent anticipate accelerated efforts. Barriers include infrastructure gaps, high costs, and customers' reluctance to pay premiums for sustainable products. More than 30 per cent are exploring renewable energy, seeking advisory services and analytics to advance.
Overseas expansion targets ASEAN
Nearly 90 per cent of businesses are eyeing overseas expansion, with over 50 per cent expecting faster progress post-tariffs. Malaysia, Singapore, and Vietnam are top ASEAN destinations that Thai businesses are interested to venture in, followed by China and North Asia. Revenue growth and profitability drive these plans, though challenges like limited local customers and knowledge gaps persist. Businesses seek insights, financial support, and industry connections for their cross-border venture.
Workforce challenges intensify
Half of Thai businesses face workforce issues, particularly around compensation and flexibility, amplified by AI advancements and younger workers' expectations. As a result, nearly 40 per cent struggle with talent retention, addressing it through higher pay, digital transformation, flexible work, and job rotations.