The Thai-Cambodian border, once a bustling artery for trade and travel, has become a flashpoint for regional tension and economic disruption following the outbreak of armed clashes in late June 2025. Since June 24, the escalation of the conflict has forced the closure of key border trade checkpoints, sending shockwaves through businesses and communities on both sides. The closure has not only halted the overland movement of goods but also triggered a cascade of challenges for exporters, workers, and major brands operating in the region.
According to Bangkok Post, the sudden shutdown of border routes compelled Thai exporters to switch from road to maritime transport, a shift that has led to significant delays and higher shipping costs. For Carabao Group Plc, a leading Thai energy drink manufacturer, the impact was immediate and severe. "We were unable to transport goods by land for seven to eight days, so we had to switch to sea freight, which delayed shipments and hit second-quarter sales," said Romtham Sathientham, managing director of Carabao Group Plc. The ripple effect was clear: exports to CLMV markets—Cambodia, Laos, Myanmar, and Vietnam—contracted by 4% during the quarter.
The company, anticipating ongoing instability, has mapped out multiple risk scenarios. In the worst case, if shipments are halted entirely, Carabao could face a suspension of sales in Cambodia for up to two months. Despite these challenges, Carabao is pressing ahead with its plans, moving up the timeline for its Cambodian energy drink plant, now scheduled to open in December 2025. "Since the closure of the border trade checkpoints, we couldn’t deliver at all. Our second-quarter sales could have been tens of millions of baht higher than reported if we had been able to sell during those days. Although exports to Cambodia have now resumed, we expect the impact to be more visible in the third quarter," Romtham added.
Interestingly, while sales in Cambodia have suffered, energy drink sales in Thailand near the conflict zone have seen a slight uptick, largely due to purchases by frontline workers and donations. Nevertheless, Romtham emphasized that the increase is not significant enough to drive overall market growth, which stood at about 5% in the first half of 2025.
The conflict’s reach, however, extends well beyond the beverage sector. Thai brands operating in Cambodia have been forced to suspend marketing and advertising activities, a move they hope will be temporary. "Overall, Thai goods and brands may face some challenges, but we believe this will be short-term," a senior executive from Carabao Group told Bangkok Post. The executive noted that Cambodian consumers continue to value Thai products for their quality and brand image, drawing a parallel to the way Thais appreciate Japanese goods. Still, most advertising, especially television, has been put on hold, with costs absorbed by local partners.
Labor dynamics have also shifted dramatically. Pan Asia Footwear Plc, a major Thai footwear manufacturer, has seen around 70% of its roughly 100 Cambodian factory workers recalled to their home country, slashing shoe production by 20–30%. "Most of our Cambodian staff have been with us for a decade or more, renewing contracts year after year," explained Sommat Khunset, chairman of Pan Asia Footwear Plc. "Our HR department spoke with each of them and found that their families were calling in tears, urging them to come home out of fear of possible consequences." To cope with the labor shortage, the company is recalling Thai workers and bringing in Myanmar nationals, though only a small number can enter Thailand each day due to procedural constraints.
The company has also put plans to enter the Cambodian market on hold, redirecting its focus to other ASEAN countries such as Malaysia. "If Cambodia isn’t ready, we will prioritise other markets," Sommat said. He acknowledged the broader impact on consumer sentiment in Cambodia, though sales in Thai border areas have not been significantly affected. Reflecting on the situation, Sommat remarked, "If we do not have a country, how can we have an economy?"
Meanwhile, the fast-food giant KFC Thailand, which operates more than 1,000 outlets, is monitoring around 10 branches located in the border areas affected by the unrest. According to Associate Marketing Director Patra Patrasuwan, the company has so far experienced limited impact, with only one branch temporarily closed for security reasons before reopening. KFC has also ramped up support for staff and delivered fried chicken to officials and evacuees in shelters across Surin, Buri Ram, and Si Sa Ket provinces. "KFC is part of the community. Whether it’s floods, earthquakes or other emergencies, the brand has a responsibility to offer support. We already have clear operational protocols for such situations," Patra told Bangkok Post.
Advertising and marketing have not been spared from the fallout. Wichit Kunkongkaphan, head of international business development at Media Intelligence Group, said the conflict has led Thai brands to freeze all marketing and advertising aimed at Cambodian consumers, both in Cambodia and in Thailand. For agency clients alone, this pause affects monthly advertising budgets of 3–4 million baht, much of it allocated to television. "Right now, our Thai brand clients operating in Cambodia have stopped everything because the situation is too sensitive. Whether spending resumes next month is difficult to predict; it depends on how the scenarios develop," Wichit said. The affected brands span beverages, construction materials, retail, banking, financial services, telecommunications, and mobile phones.
This marketing pause could open the door for competitors from Vietnam and China to make inroads into the Cambodian market. Wichit warned, "Cambodia’s population is similar in size to a region of Thailand, such as the northeast. They like Thai products and are familiar with them through Thai content, which gave us an advantage. But now we face tougher competition, and given that many Thai brands market heavily on their ‘Thai-ness’, we need to pause. This could be an opportunity for other local or regional brands." He cited Myanmar as an example, where a ban on Thai imports enabled local brands to gain market share.
The human impact of the conflict is starkly visible at the border itself. On July 28, 2025, Cambodian migrant workers were seen crossing the Ban Laem Border checkpoint in Chanthaburi province, Thailand, to return home, as reported by Reuters. The ongoing uncertainty has left many workers facing an unpredictable future, torn between the safety of home and the economic necessity of work in Thailand.
For the wider business community, the closure of the border and the intensification of clashes have resulted in initial estimated losses running into the hundreds of millions of baht, according to a source in the consumer goods sector. Essential goods, once transported efficiently by land, must now be shipped by sea, further compounding delays and costs.
As the Thai-Cambodian border conflict drags on, the economic and human toll continues to mount, with businesses recalibrating strategies and communities adapting to a new, uncertain reality. The hope, shared quietly by many on both sides, is for a swift return to stability—before the cost becomes even harder to bear.
