Exports are expected to continue to struggle next year due to the grimmer global economic outlook, says Nopporn Thepsithar, chairman of Thai National Shippers' Council.
Delayed by the ongoing quantitative easing of the euro-zone bloc and Japan, the global economic cycle has yet to hit the bottom and pickup normally takes a while to follow, said Mr Nopporn, who is also the director of the Export and Import Bank of Thailand (Exim Bank).
He forecast that shipments will shrink by 4.2% this year, below the 3% contraction predicted by the Commerce Ministry.
Exports will fall by 4.2% in 2015 if shipment value reaches US$18.5 billion a month for the remaining period of this year, he said.
To achieve the ministry's export growth forecast, shipment value must reach $19 billion, compared with the average of $17 billion over the seven months through July.
Exports fell by 3.56% year-on-year in July to $18.2 billion. The contraction rate had slowed from the 7.87% year-on-year decline in June, the biggest drop in exports since an 8.15% fall in December 2011. For the first seven months, shipments totalled $125 billion, down 4.66% year-on-year.
China's cooling economy has deepened concerns over exports as the world's second largest economy is a major destination for Thai goods.
Amid the global economic uncertainty, exports of almost all countries are sagging, Mr Nopporn said, adding that export-reliant countries in Asia such as Taiwan and Japan with high exposure to the US and China have suffered more than Thailand, which has more diverse export destinations.
But the value of exports has fallen over the past three years, fanning fears the country is losing its competitiveness. The market share of Thai-made products edged lower to 1.3%, so it is necessary to create more value-added products to compete against rivals, he said.
The Fiscal Policy Office earlier slashed its forecast for economic growth this year to 3% from 3.7% projected in April, assuming that exports will contract 4%.
The Bank of Thailand is more pessimistic. It cut economic growth for 2015 and 2016 to 2.7% from 3% and to 3.7% from 4.1%, respectively, assuming exports will shrink 5% this year and rise 1.2% next year.
Meanwhile, Exim Bank's acting president Suthaai Prasertsan said the state-backed bank approved loans of 27.3 billion baht at the end of August, above the target of 25 billion. Half the approved loans have been used as working capital but the drawn down amount was still small.
The bank's outstanding loans at the end of August amounted to 73 billion baht, below the full-year target of 78 billion. Its non-performing loans fell to 6.49% from 6.98% of total loans at the end of June.