Exports are expected to continue dropping in December because of the global economic slowdown, but the Commerce Ministry remains confident that full-year export growth should be around 7%.
Commerce Minister Jurin Laksanawisit said on Tuesday the anticipated drop in December would also stem from a relatively high base in December last year.
Customs-cleared exports tallied US$24.9 billion in December 2021, a rise of 24.2% from the same month a year earlier, with imports increasing by 33.4% to $25.3 billion, resulting in a trade deficit of $354 million.
For the whole year of 2021, exports expanded by 17.1% to $271 billion, while imports rose by 29.8% to $268 billion, resulting in a trade surplus of $3.57 billion.
"With respect to the export outlook, the ministry assesses that the slowdown of the global economy and consumption will inevitably affect Thai exports. The appreciation of the baht coupled with geopolitical tensions might also be hindrances to exports during the remaining period of the year," he said.
"However, the efficient management of central banks in many countries has resulted in a slowdown in inflation and commodity prices. This may be a supporting factor that pushes up the purchasing power of trading partner economies. Moreover, government efforts to promote more exports through the China-Laos Railway along with China's reopening will be important factors driving trade growth since the beginning of 2023," he said.
The Commerce Ministry reported on Tuesday that exports dropped for a second straight month in November, blaming the global economic slowdown and China's lockdown measures.
The customs-cleared value of exports contracted by 6% year-on-year in November to $22.3 billion, after a 4.4% year-on-year drop in October.
Imports; however, increased by 5.6% to $23.6 billion, resulting in a trade deficit of $1.34 billion.
Exports of agricultural and agro-industrial products dropped by 2% in November from a year earlier to $3.73 billion, while shipments of industrial products declined 5.1% to $17.8 billion.
For the first 11 months of 2022, exports still expanded by 7.6% to $265 billion while imports rose by 16.3% to $280 billion, resulting in a trade deficit of $15 billion.
Mr Jurin said exports had been affected by the slowdown in the global economy, as higher prices and interest rates weigh on consumer purchasing power. Moreover, the zero-Covid measures in China affected the manufacturing sector, as reflected by the global Purchasing Manager's index (PMI) which was below 50 for three consecutive months.
The contraction of exports in November was lower than that of other Asian countries such as South Korea which saw a drop of 14% in the same month, with Taiwan down by 13.1%, China down by 9.2%, Vietnam down by 8.9% and Singapore down by 6.3%.
Nonetheless, there were positive factors, namely the continued decline in freight rates of US and European routes and the Ministry of Commerce's export stimulus strategies during the end of the year.