Thailand
Thailand: Export growth set to dip
Thai export growth is expected to slow to 5% in 2022, down from the 12% forecast for this year, as global demand and inventory become normalised.
Existing risk factors include the relatively high freight rate, a shortage of shipping space, containers, and chips, as well as volatile oil and steel prices, said Chaichan Chareonsuk, chairman of the Thai National Shippers’ Council.
Mr Chaichan said the Covid-19 situation will be another key risk factor next year, as the number of infections in Thailand remains relatively high.
More importantly, he said a shortage of workers in the manufacturing sector is expected to continue, with anticipated rising employment costs. In addition, the government is yet to align with the new normal environment, Mr Chaichan said, citing a delay in value-added tax refunds to exporters, which affects entrepreneurs’ working capital.
“In 2022, global demand is expected to return to normal and every country will keep sufficient inventory,” said Mr Chaichan. “Nonetheless, the council still believes Thai exports will continue to expand further in the year to come under the assumption that the baht averages 33 baht per US dollar, the oil price remains around US$85 a barrel, and the freight rates do not go too high.”
Mr Chaichan tipped food, rubber, textiles and garments, automotive and parts, and plastic and chemical industries, as being the export products with the highest growth prospects.
The Commerce Ministry reported on Oct 26 that the country’s customs-cleared exports increased by 17.1% year-on-year in September to $23 billion, with imports increasing by 30.3% to $22.42 billion, resulting in a trade surplus of $609.8 million.
It was the seventh consecutive monthly increase for exports, after gains of 8.39% in August, 20.3% in July, 43.8% in June, 41.6% in May, 13.1% in April and 8.47% in March, following a 2.59% contraction in February.
Exports of the real sector (excluding gold, oil-related products and weaponry) rose by 14.8% in September after a 19.4% gain in August.
For the first nine months of this year, Thai exports expanded by 15.5% year-on-year to $199.9 billion, while imports rose by 30.9% to $197.9 billion, resulting in a trade surplus of $2.01 billion.
The Commerce Ministry sees strong 2021 export growth a result of the continuous expansion of global trade in the fourth quarter; the baht’s depreciation; the easing of lockdown measures coupled with stimulus policies and the reopening of the country to visitors; and rising oil prices, which support oil-related product exports.
Source: https://www.bangkokpost.com/business/2208531/export-growth-set-to-dip