Exports hit 58-month high as nation rides the global economic recovery

22.12.17

Thai exporters soared to their highest in 58 months in November while exports in the first 11 months of the year hit a six-year high, the Commerce Ministry revealed yesterday.

Pimchanok Vonkorpon, director-general at the ministry’s Trade Policy and Strategy Office (TPSO), said that exports in November rose 13.4 per cent year on year to US$21.435 billion while imports rose 13.7 per cent to $19.672 billion, leaving a trade surplus of $1.763 billion. During the first 11 months of this year, Thai exports expanded 10 per cent to $216.953 billion while imports rose 14.5 per cent to $202.744 billion. The country recorded a trade surplus of $14.209 billion for that period. Exports this year are expected to see high growth with a record high in export value following the continued recovery in global trade and economy, despite risks from trade barriers and exchange rate volatility, Pimchanok said.

Deputy Prime Minister Somkid Jatusripitak said the export figures for November could help boost the whole year’s export growth to about 10 per cent, which would support the country’s reforms in the coming period. He said one good sign was the continuous increase in imports, indicating acquisition of raw materials for production to export, he said.

“Export will be a key support factor for growth but GDP [gross domestic product] may not touch 4 per cent as exports in the first quarter did not expand much. However, the key is the momentum for next year and the coming periods,” he said. Don Nakornthab, senior director at the Bank of Thailand (BOT), said that the export figures for the month of November and the first 11 months of the year came slightly higher than expected. He said it was possible for Thai exports to end the year higher than the central bank’s latest forecast of 9.3 per cent but not more than 10 per cent.

Growth forecasts raised  
Siam Commercial Bank’s Economic Intelligence Centre (EIC) revised up its export growth forecast for this year to 10 per cent from the earlier estimate of 8.5 per cent. Import growth estimate was also raised to 14 per cent from the previous projection of 13 per cent. The centre also upped its projection of Thai economic growth to 4 per cent for the whole year from the earlier estimate of 3.8 per cent. Pimchanok said Thai exports in November grew satisfactorily to all key destinations, particularly South Asia and Asean.

In November, shipments of Thai agricultural and agro-industry product group including rice, frozen and processed chicken, canned, frozen fruits and vegetables, rubber and sugar continued to rise sharply for a 13th straight month, she said. Shipment of manufacturing products continued to rise for a ninth straight month.  The top gainers were rubber products, automobiles and components, facsimile machines, telephones and components.

The BOT believes Thai exports will continue to grow in the coming months as the global economy will likely expand more than previously forecast after the US Congress moved to pass tax legislation backed by President Donald Trump, Don said. Thai exports are projected to grow 4.2 per cent next year, while imports are forecast to expand 7.2 per cent, the EIC noted.

The centre expected exports next year to be driven by the economic expansion of Thailand’s trading countries and likely improvement in household demand from major economies and Asean members. The EIC, however, warned of risks to Thai exports from the likely appreciation of the baht and sluggish crude prices and related crude products, which account for about 17 per cent of total Thai exports. Exports to Asia, excluding Japan, is expected to rise 7.1 per cent this year and 5.1 per cent next year, based on Asia Pacific Consensus as of December 2017. Thai imports will likely rise in line with the demand for raw materials and capital goods, which tend to expand along with Thai investments that are expected to see a recovery next year, the EIC said.