Thai exports contracted for the tenth consecutive month in July, and much faster than expected, as global demand continued to slow. The Commerce Department said on Friday that it would be difficult to meet the export growth target for the full year.
Customs-based exports, the main driver of Thailand’s economy, shrank 6.2% in July from a year earlier, while analysts polled by Reuters had expected a 0.75% decline on average. Exports fell 10.8% in June.
“The sharp decline in global commodity prices, due to conflicts in Ukraine in the previous year, led to a significant slowdown in related export values,” the ministry said in a statement, adding that China was also affected by the slow recovery.
However, the decline in Thai exports was less than that of many other countries, Kirati Rochanu, permanent secretary of the ministry, told a news conference.
“Although exports were down in July, the big picture in terms of value is not bad,” he said, citing the higher comparison base for last year’s decline.
The value of exports in July amounted to $22.14 billion, compared to $23.6 billion in the same month of 2022.
Kirati said that the ministry aims to achieve a growth in exports ranging between 1% to 2% this year, but indicated that achieving this will be difficult.
He said exports in the first seven months of 2023, which contracted 5.5% year on year, were satisfactory.
“In the remaining four to five months, we will work hard not to make the numbers too ugly,” he added.
Exports will pick up in the fourth quarter of 2023, thanks to a lower base last year and an increase in vehicle shipments, said Chaichan Charunsuk, chairman of the Thai National Shippers’ Council. “But if the economies of the trading partners pick up again in the fourth quarter of 2023, exports will rise again.
“But if the economies of trading partners do not recover, exports may contract by 1% this year,” he added at the press conference.
In July, exports of computers and spare parts fell 24% year on year, while exports of automobiles rose nearly 30%. Rice exports rose 4.5% year on year to 604,310 tons.
Exports to the US rose 0.9% year-on-year in July, while exports to Southeast Asian countries fell 21.8%. Exports to Japan decreased by 1.7% and to China by 3.2%.
In July, Thailand posted a trade deficit of $1.98 billion, larger than the expected deficit of $1.3 billion, with imports down 11.1% year-on-year.
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