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Thailand: Shippers seek 1-2% export growth this year
Despite a host of risk factors, including an uncertain global economy and relatively volatile energy prices, the national shipping group still hopes to stimulate export growth of 1-2% this year.
Chaichan Chareonsuk, chairman of the Thai National Shippers’ Council (TNSC), said yesterday there are several risk factors that could pose obstacles, particularly the international economy and the possibility of a recession and production slowdown.
In addition, global energy prices are fluctuating because of the geopolitics related to several countries, leading to increased production costs in the industrial sector, especially for electricity as well as inflation.
He said exports are still expected to gradually improve in the second quarter compared with an anticipated 8% contraction in the first.
The TNSC forecast outbound shipments in the second quarter to contract 0.7% year-on-year before posting gains of 1.9% and 9.8% in the third and fourth quarters, respectively.
Last month the TNSC predicted exports in the first quarter would contract by 3-5% year-on-year, mainly attributed to the adverse impact of the global economic slowdown, before increasing to 1.8% and 9.8% growth in the third and fourth quarters, respectively.
Given these headwinds, shippers recommended the Bank of Thailand support using the local currency for trade and accelerating cooperation with important trading partners to reduce the currency exchange risk from using the US dollar in transactions.
The bank should also review the policy interest rate to maintain it at appropriate levels, said the trade group.
Meanwhile, the TNSC proposed the government help control and regulate the fuel tariff (Ft), a key component of the power tariff, as power bills are the key production cost for the manufacturing sector and this may affect the competitiveness of local entrepreneurs.
The government is also advised to step up free trade agreement talks with the European Union, the European Free Trade Association (Efta) and key trading partners such as the United Arab Emirates and the Gulf Cooperation Council (GCC) to create more international trade opportunities, said the TNSC.
Efta comprises Iceland, Liechtenstein, Norway and Switzerland, while the GCC comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
The Commerce Ministry reported on March 2 the customs-cleared value of exports dipped for the fourth month in a row in January, falling 4.5% year-on-year to US$20.2 billion (700 billion baht), while imports increased by 5.5% in January to $24.8 billion, resulting in a trade deficit of $4.64 billion.
Source: https://www.bangkokpost.com/business/2522606/shippers-seek-1-2-export-growth-this-year