Thai export growth this year should accelerate because of the policies implemented by US President Donald Trump, according to the chief of the Export-Import Bank of Thailand (Exim Bank).
Rak Vorrakitpokatorn, president of Exim Bank, said many countries around the world are accelerating imports to avoid the impact of Trump's policies. This includes countries in the EU, South Asia and Southeast Asia, which are acquiring goods ahead of Trump's trade policies as there is great uncertainty about the effect of these policies on US imports in the second and third quarters this year.
Mr Rak said the rush to import, driven by concerns over Trump's policies, led to a significant increase in exports in many countries in the fourth quarter last year. For example, Vietnam posted 11% export growth, China 10%, Taiwan 9% and South Korea 4%.
He said a volatile baht could also affect trade this year. Throughout 2024, the exchange rate fluctuated by as much as nine baht against the dollar.
Exim Bank advises exporters to use forward contracts or options to hedge against currency risk.
Mr Rak said an appropriate exchange rate for both exporters and importers is 34.5 baht per greenback.
He also warned of an influx of cheap Chinese goods into Thailand and global markets, including consumer goods, electronics, steel, aluminium and chemicals.
Cost volatility due to geopolitical issues and continued exchange rate fluctuations also remains a concern, said Mr Rak.
He said he anticipates the value of Thai exports to grow by 3% this year, down from the projection of 5.6-5.8% for 2024.
Addressing Exim Bank's green finance policy, Mr Rak said environmental, social and governance initiative loans accounted for 40% of the bank's portfolio last year, tallying 75.8 billion baht, with the bank projecting the share to increase to 50% by 2027.
"In addition to global economic uncertainties affecting the Thai economy, environmental issues are a concern for both people and businesses," he said.
"Rising global temperatures, increasingly severe natural disasters, and PM2.5 pollution have led to the implementation of more than 18,000 environmental regulations. Both Thailand and the world still require significant climate finance."
The Climate Policy Initiative estimates global climate finance in 2023 was worth US$1.5 trillion.
Although this amount has been increasing steadily for six years, it remains far below the estimated demand of $7.4 trillion per year for 2024 to 2030.
"This indicates the world still has a substantial need for climate finance," said Mr Rak.
Exim Bank recently reported its outstanding loans tallied 189 billion baht in 2024, up nearly 7% from a year before. Of this amount, 20% was allocated to Thai entrepreneurs investing in Cambodia, Laos, Myanmar and Vietnam, as well as new frontier markets.