Thailand
Thailand: Shippers still buoyant on export outlook
The Thai National Shippers’ Council (TNSC) still believes exports can eke out growth of 0-1% this year, as it urges swift establishment of a new government to spur the country’s trade competitiveness and address economic issues.
Chaichan Chareonsuk, chairman of the TNSC, said Thai exports from May to June are likely to slightly contract year-on-year, resulting in a 5-6% decline for the first half of the year. However, he sees opportunities in the second half to accelerate export growth and achieve a 0-1% gain for the full year.
“If we do nothing, it will remain a hope, but we have already strategised on how to actively tap more new markets for certain products. There is a possibility this year’s exports will reach 0-1% growth,” said Mr Chaichan.
According to the Commerce Ministry’s latest data, in the first four months of 2023, Thai exports decreased by 5.2% year-on-year to US$92 billion, while imports fell by 2.2% to $96.5 billion, resulting in a trade deficit of $4.51 billion.
Mr Chaichan said Thai shipments have passed their nadir and are heading in the same direction as the global market. Both the public and private sectors have planned aggressive market openings in new regions such as the Middle East, China, and India, where the economies are recovering, he said.
Special task forces have been established to ramp up exports for specific products such as rice, food, rubber and sugar to compensate for the decline in hard disk drives, plastic pellets, textiles and garments.
Mr Chaichan said several risk factors could hinder export plans in the second half of the year and affect the economy. These include delays in the formation of a government, which could stymie export promotion plans and the country’s economic performance, as well as global economic uncertainties resulting from geopolitical conflicts affecting several sectors such as finance, manufacturing, exports, raw materials and energy.
Global interest rates remain high, leading to a sluggish economy and raising the financial costs for business operators.
More importantly, production costs remain high, such as electricity bills, which affect Thailand’s price competitiveness, he said.
In addition, the volume of stockpiled goods in trading partners remains high, resulting in delayed orders, while weather-related factors could affect the agricultural sector in Thailand.
Given these circumstances, the TNSC suggests expediting the process to form a government, enabling the promotion of export plans and efforts to address economic issues.
The group asked the Bank of Thailand to carefully consider adjusting interest rates to prevent an excessive burden on small and medium-sized enterprises. The TNSC also urged the government to provide appropriate electricity management services to mitigate the impact on production costs and maintain a competitive advantage with key trading partners.
The council recommended implementing mechanisms to promote trade-related measures that are environmentally friendly.
Moreover, Mr Chaichan said the TNSC prepared a strategic plan to enhance Thailand’s trade competitiveness that it plans to propose to the new government. The plan consists of three main strategies: reducing costs, improving efficiency, and creating trade opportunities to support continuous export growth through 2024.
Source: https://www.bangkokpost.com/business/2586574/shippers-still-buoyant-on-export-outlook