July exports beat forecast, but virus looms

July exports beat forecast, but virus looms

FILE PHOTO: Men work at a Honda plant in Prachin Buri in May 2016. (Bangkok Post photo)
FILE PHOTO: Men work at a Honda plant in Prachin Buri in May 2016. (Bangkok Post photo)

Exports rose more than expected in July but Thailand's biggest coronavirus outbreak to date and movement restrictions are likely to impact shipments in August and September, , Commerce Minister Jurin Laksanawisit said on Monday.

That compares with a forecast for a rise of 19.7% in July in a Reuters poll and after a rise of 43.82% in June. 

Exports, a key driver of Thailand's growth, increased 20.27% in July from year earlier as global demand improved, beating a forecast for a 19.7% in a Reuters poll, and against June's 43.8% year-on-year rise.

Exports are a rare bright spot as the country struggles with a surge in infections, prompting movement curbs in areas which account for about 80% of gross domestic product (GDP).

"The lockdown measures may have impacted the manufacturing sector as we've seen some closures of fruit factories for exports," commerce minister Jurin Laksanawisit told a news conference.

The outbreak has increasingly affected factories factories and worsened a labour shortage, threatening exports at a time of stronger global demand and a weaker baht.

On Monday, the Federation of Thai Industries (FTI) called on government support for factories including clear "bubble and seal" measures and more vaccines.

"The industrial sector is the only engine to GDP and exports and it wants the outbreaks at factories to be contained," FTI Chairman Supant Mongkolsuthree told a separate briefing.

The Commerce Ministry said exports from the real sector, which excludes gold, oil-related products and arms, leapt by 25.38% year-on-year.

Industrial goods account for about 80% of exports which in July were led by stronger shipments of vehicle  and auto parts as well as computers and components.

Demand from key markets was higher in July, with exports to the United States up 22% year-on-year, to China up 41%, to Japan up 23% and to the European Union up 21%.

Imports in July jumped 45.9% from a year earlier, beating a forecast 43% rise, resulting in a trade surplus of $183 million for the month.

In the January-July period, exports rose 16.2% from a year earlier, while imports increased 28.7%, resulting in a trade surplus of $2.6 billion.

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