Thai exports decline for seventh month as global demand slows

The Thai Ministry of Commerce has reported a decline in the nation’s export value for the seventh consecutive month. In April, the value dropped by 7.6% compared to the previous year, a significantly larger decrease than the 2% fall anticipated by economists. April’s exports were valued at US$21.72 billion, a notable decrease from March’s 12-month high of US$27.65 billion. Despite the decline, the ministry maintains its target of 1-2% export growth for this year.

In April, Thailand recorded a trade deficit of US$1.47 billion, much higher than the forecast deficit of US$450 million, while imports contracted by 7.3% year-on-year. In the January-April period, exports saw a decline of 5.2% from the previous year, with imports dropping by 2.2% and a trade deficit of US$4.52 billion.

The Thai National Shippers Council highlighted several unpredictable factors affecting Thai exports, including a sluggish US economy, China’s slow economic recovery, and the fluctuating value of the baht. The council emphasised the need to intensify export promotion efforts in the second half of the year, identifying opportunities for growth in the US and EU, albeit at a lower rate, and new markets such as Central Asia and Latin America.

Poj Aramwattananont, vice-chairman of the Thai Chamber of Commerce, has expressed concern over increasing production costs for exports. Exporters are facing rising costs due to energy, electricity, and the potential for a higher minimum wage under a new government.

In the fourth quarter of 2022, Southeast Asia’s second-largest economy experienced slower-than-expected growth as exports and manufacturing declined. The long-awaited recovery in tourism is projected to stimulate the recovery this year, despite the decrease in global demand for manufactured goods.

According to data released by the National Economic and Social Development Council (NESDC) on Friday, GDP contracted by a seasonally-adjusted 1.5% in Q4, dashing hopes for a 0.5% increase.