Ministry still upbeat on export recovery

Ministry still upbeat on export recovery

Seeks 1-2% growth target for full year

An aerial view shows Bangkok Port located on the east bank of the Chao Phraya River in Bangkok's Khlong Toei district. (File photo)
An aerial view shows Bangkok Port located on the east bank of the Chao Phraya River in Bangkok's Khlong Toei district. (File photo)

Despite economic uncertainties among Thailand's trading partners, China's slower than expected economic recovery, the vulnerable European economy, Russia's withdrawal from the Black Sea Grain Initiative and the drought associated with the El Niño weather phenomenon, the Commerce Ministry remains confident that the export outlook over the coming months will continue to show a gradual recovery.

Permanent commerce secretary Keerati Rushchano attributed the supporting factors to export recovery to accelerated openings in markets with strong potential, such as Central Asia, Latin America and Africa, helping diversify risk and mitigate the impact of a slowdown in major export markets.

Additionally, the continuous trend of a weaker baht is creating a favourable environment for exporters, giving them a competitive edge in international trade.

Moreover, he said rising global concerns over food shortages may drive up the value of agricultural exports.

"In the remaining months of the year, the Commerce Ministry will collaborate with the private sector to boost exports and organise promotional activities to their fullest potential. These activities will take place in Kunming in August, followed by Nanjing and Shanghai in September," said Mr Keerati.

The ministry reported on Thursday that the customs-cleared value of exports dipped for a ninth consecutive month in June, falling by 6.4% to US$24.8 billion, while imports decreased by 10.3% to $24.7 billion, resulting in a trade surplus of $57.7 million.

Exports of agricultural and agro-industrial products contracted by 8.6% year-on-year in June to $4.53 billion, while industrial product exports dropped 4.6% to $19.3 billion.

For the first half of 2023, exports decreased by 5.4% to $141.1 billion, while imports decreased by 3.5% to $147.4 billion, resulting in a trade deficit of $6.3 billion.

The Commerce Ministry is maintaining its annual export growth target of 1-2% for the full year.

Mr Keerati said rising concerns globally over possible food shortages could drive up the value of Thailand's agricultural exports.

Chaichan Chareonsuk, chairman of the Thai National Shippers' Council, said although export figures have been continuously negative, the private sector predicts that exports will start to turn positive from this month.

He said automobiles and auto parts, electronics, and agricultural products such as rice, sugar and foods are likely to perform quite well in the remaining months of this year, while the outlook for plastic pellets and chemicals, which remains negative, would depend on China's recovery.

If Thailand can achieve an average monthly export value of $24 billion during the rest of the year, it would undoubtedly bring exports for the whole year back to positive territory, he said.

The council recently trimmed its export forecast to a range of -0.5% to 1% growth, compared with 0-1% growth previously, based on high uncertainty surrounding major trading partners such as the US, the European Union and China, in addition to relatively high global interest rates.

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