Thailand is a "leading beneficiary" of the trade fight between the U.S. and China, according to Standard Chartered's Clive McDonnell.
"We've seen plenty of evidence of companies, in particular Japanese companies, trying to shift production out of China and into other (Association of Southeast Asian Nations) countries," McDonnell, who is head of equity strategy at Standard Chartered Private Bank, told CNBC's "Street Signs" on Friday.
Thailand has benefited from the disruptions in supply chains caused by the trade war, he said.
In the past year or so, Washington and Beijing have slapped higher tariffs on each other's goods, and companies that have been producing their goods in China have had to look for manufacturing facilities elsewhere to circumvent those tariffs.
"Thailand's not the only beneficiary, (but) with the currency ... appreciating strongly, that reflects the underlying view that it is a leading beneficiary," McDonnell said.
Since the start of the year, the Thai baht has appreciated more than 6% against the dollar.
The trade battle has "increased the importance of Thailand" as a base for manufacturing Japanese goods such as auto parts and electronics to be exported to America, McDonnell explained in an email to CNBC. Japan is Thailand's largest source of foreign direct investment, he said.
Export growth in Thailand is starting to recover from a slowdown in the second half of 2018, and foreign exchange reserves rose $20 billion this year to $220 billion, McDonnell pointed out.
"This has contributed to the upward pressure on the baht as has the increase in tourist arrivals following the dip related to the boat sinking tragedy in 2018," he said, referring to a tourist vessel that sank off Phuket last year, killing more than 40 people. It was one of Thailand's worst accidents.
In September, Thailand announced a package with incentives to attract firms hit by the U.S.-China trade war to move their production to the Southeast Asian country.
When asked whether the strength of the Thai baht could impact the country's export competitiveness at a time when other currencies such as the Chinese yuan has seen a significant weakening, McDonnell acknowledged it as a "challenge."
Still, he added: "If you look at the history of the Thai baht, it is a very volatile currency," the strategist said. "Exporters have had to battle with ... significant fluctuation in the currency over time. I think they are … experienced ... in managing, maybe, some of their cost base."
Regionally, Vietnam has often been named as one of the biggest winners from the fallout of the U.S.-China trade war.
However, data so far suggests that Vietnam has a long way to go before it can match China's manufacturing capabilities.