Thai businesses activate contingency plans amid Cambodia border shutdown

Following the closure of six permanent and ten temporary checkpoints along the Thai-Cambodian border—spanning provinces such as Si Sa Ket, Buri Ram, Ubon Ratchathani, Sa Kaeo, Surin, Chanthaburi, and Trat—Thai businesses are rushing to activate contingency plans, facing soaring transportation costs and logistical delays.

Companies operating in Cambodia are implementing business continuity plans, covering staffing, supply chain management, and coordination with Cambodian authorities. Some firms have begun repatriating Thai staff for safety.

Voratat Tantimongkolsuk, President of the Thai-Cambodian Business Council, noted that the border closures have hit cross-border trade and the local economy in seven provinces. With direct land access cut off, businesses are left with two primary options:

1. Land route via Laos – Goods must be rerouted through Ubon Ratchathani, entering Laos at Chong Mek, proceeding through the Wang Tao–Phonthong Special Economic Zone in Champasak Province, then down into northern Cambodia and onwards to Phnom Penh. This detour is significantly longer and more costly.

2. Maritime route – Shipments are being redirected via coastal ports such as Khlong Yai Port in Trat, or from larger ports like Khlong Toei and Laem Chabang, then onward to Sihanoukville in Cambodia. However, Khlong Yai Port, being small, is already booked out until mid-July.

The logistics burden has been immense. A delivery route that previously spanned 500 km through Sa Kaeo to Sisophon and Poipet now stretches up to 1,500 km, tripling transport costs. This has forced many Cambodian buyers to source products elsewhere and caused some Thai manufacturers to delay shipments or suspend operations—particularly for factories in Cambodia reliant on Thai raw materials, such as garments.

Japanese investors with production bases along the Thai-Cambodian border are also affected. Their operations now face labour cost pressures and potential delivery penalties due to disrupted supply chains.

The situation is forcing businesses across sectors to adapt. Restaurants and hotels in Cambodia that rely on Thai ingredients are shifting to alternative sources. Manufacturers are seeking new suppliers, though multinational firms with global sourcing capabilities face higher costs, impacting profits and operations.

Thai exporters shipping goods to Cambodia by land are now shifting to maritime channels, which has significantly increased costs. Higher prices are being passed on to consumers in Cambodia, dampening demand and hurting retail sales. Some Thai petrol stations in Cambodia may also be forced to raise prices as they switch from Thai fuel to more expensive sources.

“I urge the governments of both countries to engage in dialogue and find a peaceful solution. Coexistence is possible. Every measure taken will inevitably impact the people of both nations, so I hope this situation can be carefully managed to avoid further harm,” said Voratat.

He added that Thai entrepreneurs investing in Cambodia’s industrial, trade, and service sectors have also been affected. The Thai-Cambodian Business Council has been in talks with stakeholders to address key challenges—chief among them being logistics disruptions caused by border closures, which have made it difficult to transport raw materials into Cambodia.

The Council has held discussions with Deputy Prime Minister and Finance Minister Pichai Chunhavajira, where the government pledged to consider providing soft loans to affected businesses. Many companies are facing liquidity shortages due to the crisis, and recovery is expected to take up to three years before the Cambodian market stabilises.

During this time, Thai businesses must also contend with foreign competitors attempting to seize market share in Cambodia while Thai exports are blocked.

Voratat emphasised the need for the Thai government to launch economic stimulus activities in the seven affected border provinces, to support local entrepreneurs and help mitigate the broader economic fallout.

SCB prepares two-pronged contingency plan

Kris Chantanotoke, CEO of Siam Commercial Bank (SCB), said the bank is closely monitoring the situation between Thailand and Cambodia, and is in continuous coordination with the Thai Bankers’ Association (TBA). So far, there has been no direct impact on operations, and the bank continues to operate normally.

However, as a precaution, SCB has prepared contingency measures in two key areas: Staff safety for Thai employees working in Cambodia, and Liquidity management with the National Bank of Cambodia (NBC).

“If the situation deteriorates, we have a Business Continuity Plan (BCP) in place and will implement it according to strict governance principles,” Kris said.

Kasikornbank sets up full contingency measures

Pattarapong Kanhasuwan, Executive Vice President of Kasikornbank, said the bank is still operating as usual with all services fully available. The bank has prepared contingency measures across all areas, including personnel, operations, and IT systems, to ensure continued support in case of emergency.

“While the situation remains tense and could shift at any time, we want to reassure customers that there has been no impact on financial transactions to date. Kasikornbank is fully committed to supporting customers through any eventuality,” he said.

Carabao Group increases stockpile to three months

Romtham Sathientham, Managing Director of Carabao Group Plc, said the Thailand-Cambodia border closure has not yet affected Carabao Dang energy drink sales. The company and its distribution partners already maintain buffer stock to meet consumer demand. Concerns over higher logistics costs are being absorbed by the partners, who are covering additional shipping expenses for sea transport.

However, the key challenge is stockpiling three months' worth of inventory to sustain supply. Carabao must manage logistics tightly to maintain availability, as it needs stock for an average of 40 million cans per month, or 120 million cans over three months. This requires a significant shipping capacity of around 1,500 containers.

Carabao also plans to accelerate the opening of its new production plant in Cambodia, originally scheduled for Christmas 2025, by 1–2 weeks if needed. The facility is part of a multi-billion-baht investment, aimed at establishing a local production base after nearly 20 years of operations in Cambodia.

“Carabao Dang is the market leader in Cambodia’s energy drink segment, with annual sales of 400–500 million cans, or approximately 2 billion baht. We are closely coordinating with our local partners amid current challenges,” Romtham said.

“Short-term, our biggest challenge is raising stock from one month to three. With sales currently averaging 40 million cans per month, this is a major logistical task.”

He added that although the factory opening may be brought forward by only a week or two, it could help ensure continuity. Carabao will also continue to ship concentrate only, rather than raw materials, until operations resume normally.

“We’re hopeful that by the time the plant opens, the situation will have stabilised,” he concluded.

Mama halts Cambodian production orders

Pun Paniangvait, General Manager at Thai President Foods Plc, said the company has been operating in Cambodia for more than 20 years, and considers it a key market. Among Thailand’s export destinations, Cambodia is one of the strongest performers globally. Mama, the flagship instant noodle brand, holds an 80% market share in Cambodia. Most recently, the company invested 200 million baht to expand its production capacity in the region.

However, due to the ongoing Thailand–Cambodia tensions and the closure of all border checkpoints, operations have been disrupted—particularly the shipment of raw materials for production and exports. As a result, the company has temporarily suspended production of orders for the Cambodian market, including cup noodle products destined for sale there.

“Our Cambodian instant noodle market is comparable in size to a whole region in Thailand, such as the Northeast,” Pun said. “What we’re most concerned about right now is the export of raw materials to our production site in Cambodia. With the borders shut, we’re exploring alternatives like sea freight.”

Nanyang monitors impact on cross-border retail

Chakrapol Chandavimol, General Manager of Nanyang Marketing, said the company distributes its Nanyang shoes across several ASEAN markets, with major sales in Myanmar, Malaysia, and the Philippines. Cambodia also has retail sales, mainly through border-town shops.

At present, the company has not observed any significant disruptions but is monitoring the situation closely and waiting for further updates from its Cambodian retail partners.

“So far, the situation has not had a major impact on our business, but we are keeping a close eye on how our retail partners along the border are affected,” Chakrapol said.