Exports down in June, but foreign reserves rise
The value of Thailand's exports in June fell 3.38% from the same month last year to US$19.10 billion, the Commerce Ministry said on Friday.
- Published: 26/07/2013 at 04:42 PM
- Newspaper section: topstories
The decline followed a drop of 5.3% in May, as demand continued to slow in many major markets. The ministry conceded that it would not meet its target of 7% to 7.5% growth for the year.
The biggest concern was China, where export values in June were down 17% from a year earlier. China is Thailand's largest market, accounting for 11% of all the country's exports.
The performance in June was far worse than expected. A Bloomberg survey of economists had forecast a 1.6% increase.
Construction in Bangkok and elsewhere is slowing as firms are awaiting the approval of budgets for government megaprojects, officials say. (Photo by Patipat Janthong)
Vatchari Vimooktayon, the ministry's permanent secretary, said imports in June totalled $21.01 billion, up 3.01% year-on-year, for a total trade deficit of $1.91 billion.
Exports in the first six months of the year were worth $113.3 billion, up just 0.9% from the same period last year, she said.
Imports were up 4.32% to $129.07 billion, resulting in a trade deficit of $15.77 billion.
The global economic slowdown had lowered demand for Thai products, she said. In addition to China, other markets showing weak demand were the Netherlands, the United Kingdom, Belgium, France, Italy, the United States and Japan.
The permanent secretary said imports of machinery and parts were also down because of weak economic conditions in the country's trade partners and slower domestic growth.
As well, she said, there had been a slowdown in the construction sector with budgets for the government's infrastructure megaprojects still awaiting approval from parliament.
Mrs Vatchari admitted that the 2013 export growth target of between 7% and 7.5% would not be achieved and would be revised.
She expected exports to grow by about 3% this year, nearly the same as last year's expansion rate.
In another development, the Bank of Thailand reported that foreign reserves as of July 19 totalled $171.2 billion, an increase of $600 million from the previous week.
The net forward position, reflecting the central bank's status on foreign currency purchases in the futures market, totalled $23.6 billion, down $200 million from the previous week, putting net foreign reserves at $194.8 billion, it said.
Reserves increased slightly as the BoT had to intervene in the money market to curb the baht's fluctuations by purchasing US dollars on the spot market, the central bank said.