Thailand: Commerce Ministry puts 2022 export growth at 3-4%

The Commerce Ministry has set the export growth target at only 3-4% for next year, slightly lower than projections by private organisations, citing a spate of persistent risk factors such as prolonged Covid-19 outbreaks, stiffer measures for public health and the environment and a shortage of labour and semiconductors.

Commerce Minister Jurin Laksanawisit said the 3-4% growth target for next year from an estimated US$268.3 billion this year, up 16% from a year before, is based on a warning by the Organisation for Economic Co-operation and Development (OECD) that a renewed wave of the pandemic threatens to add to the existing pressure on the world economy from persistently high levels of inflation.

The Paris-based organisation said if the Omicron variant takes a more severe turn, it could also force governments to reimpose tighter mobility restrictions, hurting demand for goods and services, leading to a sharp fall in economic activity and lower inflation, similar to the earliest phase of the pandemic.

The OECD predicted in its updated economic outlook the world’s economy will expand by 5.6% this year, down from an earlier forecast of 5.7%.

Its forecast for 2022 remains unchanged at 4.5%, but the report was released only days after Omicron was detected.

Mr Jurin revealed the ministry’s forecast after a virtual meeting yesterday with the Joint Public and Private Sector Consultative Committee on Commerce and commercial ambassadors worldwide.

According to Mr Jurin, next year’s export growth will be driven largely by recovering economies of Thailand’s important trading partners, a favourable exchange rate at 32-33 baht per US dollar, rising Dubai crude oil and agricultural product prices, as well as an increase in container production.

Mr Jurin said another booster is the implementation of the Regional Comprehensive Economic Partnership (RCEP) early next year.

“Cross-border trade is also expected to see continued strong growth of 5-7 % next year, with exports from Thailand estimated at 1.07-1.08 trillion baht,” Mr Jurin said.

Sanan Angubolkul, chairman of the Thai Chamber of Commerce as the representative of the Joint Standing Committee on Commerce, Industries and Banking (JSCCIB), said the committee has set the export growth of 2022 at 3-5%, which is slightly higher than the commerce ministry’s prediction mainly because of the baht’s depreciation and cooperation between the government and private sector.

Next year, the JSCCIB proposed the government speed up efforts on the regulatory guillotine, eliminating outdated laws and regulations that hinder business activities and public services.