Thailand's exports are expected to shrink by 3.8% this year, the most in three years, because of myriad negative risks, according to the University of the Thai Chamber of Commerce (UTCC).
Aat Pisanwanich, director of the university's Center for International Trade Studies, yesterday said shipments were expected to remain in the red in the second half after a poor performance in the first half.
The Commerce Ministry reported in June that exports tumbled for a fifth straight month in May, falling by 5% year-on-year to US$18.4 billion.
In the first five months, exports fell by 4.2% from the year-earlier period to reach $88.7 billion.
The centre estimates that exports will contract by 4% to $108 billion in the first half, dragging down the whole-year figures to a 3.8% decline.
Thailand reported export contractions of 0.4% last year and 0.3% in 2013 following growth of 2.9% in 2012, 15.1% in 2011 and 26.8% in 2010.
The centre also forecasts that shipments in the second half will contract by 3.6% to $111 billion.
Markets that will see export falls include the European Union (-2.2%), Japan (-2.4%), South Korea (-11.6%), Canada (-7.7%) and Taiwan (-9.4%). Shipments to the Middle East and Africa are also expected to drop by 0.1% and 10% respectively.
"As far as we have been monitoring, there are more negative factors than positive ones — the world's economic slowdown, Greece's debt crisis, China's economic constraints and higher competition from Cambodia, Laos, Myanmar and Vietnam in key markets such as the US, China and Japan," Mr Aat said.
"Tougher competition is anticipated, particularly from Vietnam once the Trans-Pacific Partnership (TPP) trade deal takes effect."
The TPP is a proposed agreement between Pacific Ocean countries. It seeks to lower trade barriers such as tariffs, establish a common framework for intellectual property, enforce standards for labour law and environmental law, and establish an investor-state dispute settlement mechanism.
The goal is to enhance trade and investment, innovation, economic growth and the creation and retention of jobs.
Japan and the US are among the 12 countries negotiating for the TPP.
Participating countries set the goal of wrapping up negotiations in 2012, but contentious issues such as agriculture, intellectual property, and services and investments have caused negotiations to continue, with the latest round of negotiations set for late this month.
Implementation of the TPP is one of the primary goals of the trade agenda of the Barack Obama administration.
According to Mr Aat, Thailand also faces threats from falling farm prices and illegal, unreported and unregulated fishing, with the EU demanding that Thailand resolve the fishing issue by October.
If Thailand fails to tackle illegal fishing, it faces losing seafood shipments worth about 25.3 billion baht or $778 million to the EU.
Shrimp makes up 31%, fish 36% and squid 19% of seafood exports to the EU.
"Thailand may have positive factors such as the weak baht and the reinstatement of the Generalized System of Preferences by the US for Thailand for another four years and five months, but the benefits from these positive factors are not yet large enough to compensate for losses caused by negative factors," Mr Aat said.
"The target set by the Commerce Ministry for export growth of 1.2% this year is hardly possible."