The impact of trade policy uncertainty on Thai exports during the U.S.-China trade war

Abstract

This study examines the impact of trade policy uncertainty (TPU) on Thai exports as measured by the US and China Trade Policy Uncertainty Index during the US-China trade war. The paper analyzes the impact of TPU in parallel with the fluctuation in import duties during the same time period. The results indicate that trade policy uncertainty negatively effects Thai exports, particularly in the category of consumer products. On the other hand, trade policy uncertainty has an insignificant effect on Thailand's exports of intermediate products, the opposite of the effects of import tariffs on Thai exports. This study provides empirical evidence in support of the significant effects of uncertainty on exports, suggesting the need for the government to provide policy supports to ensure continuous export growth in the midst of uncertainty in today's world.