25-8-2023 (BANGKOK) Thai exports faced their tenth consecutive month of contraction in July, surpassing anticipated figures by a significant margin. The global demand slump has persisted, making it challenging for the commerce ministry to achieve its annual export growth target.
In July, customs-based exports, a vital driver of Thailand’s economy, contracted by 6.2 percent compared to the previous year. This decline exceeded the average estimated dip of 0.75 percent predicted by analysts in a Reuters poll. Furthermore, exports had experienced a substantial drop of 10.8 percent from June.
The commerce ministry addressed the issue, stating, “A sharp decline in global commodity prices, resulting from the conflicts in Ukraine in the preceding year, led to a significant slowdown in related export values.” The ministry added that China had also encountered a slow recovery.
Although the decline in Thai exports was notable, Keerati Rushchano, the permanent secretary of the ministry, highlighted that it was less severe compared to other nations. During a press briefing, he expressed, “Despite July’s export fall, the big picture in terms of value, we are not bad,” referring to the high base of comparison from the previous year.
The export value in July amounted to $22.14 billion, a decrease from $23.6 billion recorded in the corresponding month of 2022.
Keerati emphasized the ministry’s commitment to achieving the export growth target of 1 to 2 percent this year, but acknowledged the difficulties involved. He stated, “In the remaining four to five months, we will put our efforts to make the numbers not too ugly.” Keerati also highlighted that exports in the first seven months of 2023, which saw a 5.5 percent year-on-year contraction, were satisfactory.
Chaichan Chareonsuk, chairman of the Thai National Shippers’ Council, projected an increase in exports during the fourth quarter of 2023 due to a lower base from the previous year and higher car shipments. However, he cautioned that if trading partners’ economies failed to recover, exports might contract by 1 percent this year.
In July, exports of computers and parts witnessed a substantial decline of 24 percent year-on-year, while auto exports experienced a significant increase of nearly 30 percent. Rice export volumes rose by 4.5 percent to 604,310 metric tons compared to the previous year.
Regarding specific trade partners, exports to the United States saw a slight increase of 0.9 percent in July compared to the same period last year. However, shipments to Southeast Asian countries fell by 21.8 percent, exports to Japan declined by 1.7 percent, and shipments to China decreased by 3.2 percent.
Thailand experienced a trade deficit of $1.98 billion in July, surpassing the forecasted deficit of $1.3 billion. The deficit was primarily attributed to an 11.1 percent year-on-year decline in imports.
