Trade Diversion in the US Market during the US-China Trade War: Firm-level Evidence from Thailand

The US-China trade war, which began in the latter half of the 2010s, has led to increased exports from third countries to the US. This paper presents a firm-level analysis of such an increase in Thailand. Specifically, we empirically examine changes in the export rankings of Thai firms exporting to the US. Our dataset includes the top 1,500 Thai exporters to the US. By linking US tariffs on Chinese goods to exporters at the four-digit industry level, we assess the impact of these tariffs on firms' export rankings. We find that, on average, US tariffs are not significantly associated with the export rankings of Thai firms. However, major importers from China in Thailand benefit from trade diversion in the US market. Furthermore, firms in Thailand with investment from China, Singapore, the US, and Europe have increased their exports to the US following the onset of the trade war.